Asian media giants form China-focused film and TV fund
Taiwan’s Fubon Group, Hong Kong's Media Asia and South Korean music giant SM Entertainment have established a media-focused fund to jointly invest in Chinese film and TV production.
The parties will inject an initial $20 million into the fund - Dragon Tiger Capital Partners - which has an overall target of $100-200 million. The fund will start fundraising from institutional investors in late September, according to a filing.
Media Asia and SM Group will co-manage the fund, while Fubon will act as a co-sponsor. The vehicle will invest in film and TV productions that are either made in China, or target a global Chinese language audience. The fund will leverage on the operating platforms of its three backers in executing its investment strategy.
Fubon's Taiwanese cable TV network subsidiaries Kbro Media and TFN Media will participate in investment activities, as will its investment arm - Fubon Financial Holding Venture Capital.
Fubon Group's core businesses include banking, insurance and fund management. The Taiwanese conglomerate also owns local mobile operator Taiwan Mobile. In February, Fubon Financial and Kbro acquired a 14.09% stake in Media Asia for $80.27 million.
As part of the deal, Media Asia will act as the exclusive China management agency to three of SM Entertainment's artists: Zhang Li Yin, f(x), and EXO.
China is now the world's second-largest cinema market and is expected to take the top spot from the US over the next few years. A number of Chinese investors and Hollywood producers have formed partnerships in order to leverage this growth.
Three months ago, Chinese conglomerate Fosun International said it will invest in Studio 8, a Hollywood film studio, to develop film and TV series for distribution in China. In April, FountainVest Partners and CMC Capital Partners paid $80 million for a 20% stake in movie theater operator IMAX's China business, with an objective to grow the business and ultimately take it public.
In March, Hony Capital and TPG Capital's growth equity arm entered into a partnership with two Hollywood producers to set up a film studio. They plan to invest more than $1 billion film productions over the next five years.
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