The deal, announced on the eve of Chinese president Xi Jinping’s state visit to the U.S. will see the two companies establish a joint venture company Flagship Entertainment. It will be headquartered in Hong Kong, with offices in Beijing and Los Angeles.
The deal was announced by Li Ruigang, founding chairman of CMC, and Kevin Tsujihara, chairman and CEO, Warner Bros.
Flagship will be owned 51% by CMC—with Hong Kong broadcaster TVB holding 10 percent of the CMC-led consortium—and 49% by Warner Bros.
“Flagship plans to develop, invest in, acquire and produce a wide range of films for distribution throughout China and around the world, utilizing Warner Bros.’ unrivalled global film distribution network. The first titles bearing the new imprint could be released as early as 2016,” the partners said in a statement. “This creative collaboration between U.S. and China filmmaking partners also allows for the exchange of technical expertise and the development of young Chinese talent for years to come, combining Warner Bros.’ technical and creative knowledge base with CMC and TVB’s access to local talent and market expertise.”
The Chinese box office market is booming, with gross box office up by 49% in the first eight months of this year. Local language film-making is pacing the huge scores made by the biggest Hollywood titles and many forecasters have predicted that China’s box office will exceed North America’s within three or four years.
“We look forward to working with CMC in this exciting new venture, as we gain additional insight into the Chinese film industry,” said Tsujihara.