China was planning on taking over MGM (Metro Goldwyn Mayer), one of the biggest studios in Hollywood. Chinese firm’s interest in Hollywood started after the 3.5 billion deal of Legendary Entertainment. Though, MGM spokeswoman stated that MGM is not for sale. Even Though, It is way smaller now, and owned by a small private equity firms.
Lately, China has become a go-to source of Hollywood funds. There are many firms who financed with Chinese firm’s and earned billions in ticket sales.
On the other hand, Hollywood executive thinks that dealing with china may have some negatives “You have no way to assess what they might say about a deal”.
Later on, China’s pocket becomes a regular subject of speculation among entertainment executives. According to Chris Fenton (President of DMG entertainment), China’s investment in Hollywood decreased prior the election and it’s almost disappeared by this time.
In December, Chinese firm’s pulled about $350 million of Voltage picture without giving a reason. That led Voltage to sue the Chinese firm for $300 million damages.
Nevertheless, China announced an offer for $100 million to pay 51% stake of Millennium Film, who produce The Expendables. Millennium’s great hit in Chinese theater is the reason behind this offer.
I think Investing in Hollywood can be a great hit for China, and Hollywood studios can benefit from that, but it may lead The Chinese firms to take control over of the studios and over Hollywood.
Original article:
https://www.wsj.com/articles/capital-control-policy-puts-brakes-on-chinese-investment-in-hollywood-1487965450
https://www.wsj.com/articles/capital-control-policy-puts-brakes-on-chinese-investment-in-hollywood-1487965450
Mohammed Almomen
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