BEIJING (Reuters) - News Corp has agreed to buy a stake in Chinese movie distributor Bona Film Group Ltd, becoming the latest U.S. media company to expand into China’s booming movie market.
News Corp will take a 19.9 percent stake in Bona Film from founder and chief executive Yu Dong, Bona said in a statement. It gave no financial details. The Nasdaq-listed company has a market capitalization of about $392 million.
China, which posted box office revenue of $2.1 billion last year, agreed in February to open its market to more U.S. movies, adding 14 premium films, such as 3D or IMAX, to the current quota of 20 foreign films a year.
News Corp China Investments chief executive Jack Gao was quoted in the Bona statement as sayng the company was attractive because had film distribution and production as well as operating cinemas.
“China’s film market is growing at a rapid pace, positioning the country to be the second-largest film market following the United States,” Gao was quoted as saying.
News Corp in Beijing could not be reached for an immediate comment. Bona Film spokeswoman Hou Ningning said the company would not comment beyond the statement.
Bona Film distributes films through most theatres in China, and owns and operates theatres in several large Chinese cities. It has also expanded into home video products, digital distribution and television.
Bona CEO Yu said in the statement the company had developed significantly since its 2010 IPO and wanted to take on select strategic investors.
“News Corporation’s extensive global reach, investment and distribution will help accelerate our strategy to expand our global footprint,” he said.
DreamWorks Animation SKG Inc, creator of “Kung Fu Panda”, said in February it would build a production studio in Shanghai in a joint venture with three major Chinese media companies.
The venture, called Oriental Dreamworks, will develop and produce Chinese animated and live-action films for distribution in China and internationally.
Independent studio Relativity Media has also been reported to have forged an agreement to establish operations in China.
Reporting by Terril Yue Jones; Editing by Richard Pullin