(29 July 2014, Shanghai)– Fosun Group (Fosun) and Shanghai Film Group (SFG) announced today the establishment of a strategic partnership that will create a Fosun-Shanghai Film Cultural Investment Fund. The fund will become a platform for the two parties to roll out in-depth cooperation in producing, distributing and broadcasting of theatrical and TV shows, movies and other contents, as well as developing associated premium products.

 

According to the joint arrangement, Fosun Group and SFG will conduct comprehensive cooperation covering all segments in film and television production industrial chain through mergers, acquisitions and restructurings, joint investments and project initiatives. Currently, both parties are contemplating the establishment of an investment fund for cultural industries to jointly participate in investments or introduction of high-quality film and TV dramas domestically in China and from overseas. To implement the interactive “import” and “export” strategy for the cultural industries in China, the two parties will involve in investments, mergers and acquisitions of cinema circuits in an effort to tap industry opportunities emerged from the explosive growth in the motion picture market in China.

 

Ren Zhonglun, President of Shanghai Film Group said, “Shanghai Film Group, as the oldest film group in China with most comprehensive industry chain coverage, has long been adhering to our strategy of ‘Opening-up promotes reforms; and cooperation promotes development’. We believe that Fosun Group’s international resources platforms and financial strength, when coupled with Shanghai Film Group’s solid industry experiences and project operation capabilities, will take both parties to the next level for landing of more forward-looking strategic foothold. We also believe that our joint efforts with Fosun would play a pivotal role in transformation of Shanghai Film Group, and become a model of a win-win strategy for the film and television cultural industry in China.”

 

Guo Guangchang, Chairman of Fosun Group said, “We have long been optimistic about development opportunities in the cultural industries in China. Shanghai Film Group is a leading film group with rich industry experiences and abundant platform resources in the field of film and television. Through the strategic cooperation with the Shanghai Film Group, Fosun will be able to tap into the investment opportunities, leveraging the professional resources and connections provided by Shanghai Film Group. We can conduct better selections and control over projects, complement each other’s edges and achieve rapid development, provide multi-channel financing and multi-industry integration references for the cultural industries.”

 

According to Pricewaterhousecoopers, China has already become the world's fastest growing entertainment market since 2007, at 12 percent a year on average, generating the world’s third largest revenue from the market after Japan. In 2013, box office revenue from the Asia Pacific region was USD11.1 billion, the largest from a single region in the world, and had been growing at 11 percent a year on average between 2009 and 2013. Of these, about USD3.6 billion was derived from China in 2013, up 27 percent year over year, making it the only country that achieved box office revenue in excess of USD3 billion in a year outside the United States. Rapid development in the film market in China has brought about huge opportunities for explosive growth from films and associated premium products.

 

Shanghai Film Group has been on track for rapid development since its reforms began in 2003. The group puts content creation in its highest priority and as the driver for attracting talents, developing a hybrid ownership structure, adding agility and enriching core competences. Having promoted further optimization of its shareholder structure, the group has established a market-oriented operating system, enhanced its enterprise systems. These helped the group outperform its peers in economic efficiency and be included in the league of “Top 30 China Cultural Enterprises” for four times. In the future, Shanghai Film Group will adhere to its strategy of integrating industry and capital strengths and invest more in studio productions, distribution and theatrical screenings through parallel development of multi-party cooperation and access capital markets for better leverage, as part of its pursuit of a “full industry chain coverage, genres diversification, leading in creativity, competitiveness and international influence” strategy.

 

Fosun has been accelerating its investments in the film industry recently. On 6 June, Fosun entered into a unit purchase agreement with Hollywood’s Studio 8 LLC. Fosun and its subsidiaries boosted holdings in Bona Film to 20.8% of total, and has since become the second largest shareholder. Fosun is dedicated to integration of advanced and sophisticated production expertise and technique, concepts, technology, completed production and distribution systems from both the domestic and overseas film industries, to accelerate development of the film industry in China and growth in the international film industry. Fosun aspires to integrate top motion picture entertainment resources from the world through a multitude of methods including mergers, acquisitions and investments in creation of a global cultural platform of film and entertainment, cultural consumption and media networks.

 

Meanwhile, Shanghai Film Group and Fosun agreed to explore more into cooperation in operation and development in the full film and cultural chain, integrating each other’s edges in production bases and leisure tourist projects, seeking a win-win cooperation model.

 

 

 

 

Shanghai Film Group Corporation Limited is one of the largest and strongest modern film groups in China, also one of the oldest government-owned film enterprises. Over 60 years since established, SFG created and invested lots of excellent films, including “From Victory to Victory”, “Reconnaissance Across The Yangtze River”, “Tie Dao You Ji Dui”, “Memories of Peking: South Side Stories”, “Hibiscus Town”, “Kung Fu Dunk”, “2046”, “Tokyo Trial”, “Still Life”, “The Message”, “Xin Hai Revolution” and“Vajra Sky Over Tibet”, also plenty of outstanding television drama series as “Liang Jian”, “Jiao Yulu” and “Xin Shu”. Shanghai Film Group is among the few companies in film industry that are able to cover fully the industry chain, from production, distribution to screening. Shanghai Film Group is a leading national film enterprise with subsidiaries including Shanghai Film Group Corporation Limited, Shanghai Film Studio, Shanghai Animation Film Studio, Shanghai Film Dubbing and Shanghai Film Technology Plant.

Since the enterprise reforms in 2003, Shanghai Film Group has been adhering to its “open door” and “cooperation” strategy. On the top of producing a great diversity of films, the group’s major businesses include film (and TV drama) development, production, promotion, sales, distribution and screening. A complete business chain is being formed linking film and TV drama production, distribution and screening, technical services, media communications, film studios, and film education. In the coming three to five years, Shanghai Film Group will continue to deepen its reforms to complete the production line and diverse film varieties, aiming at becoming a creative leading modern film and television group with strong market competitiveness and international influences.

 

Fosun was founded in 1992 in Shanghai. Fosun International Limited (00656.HK) was listed on the Main Board of the Stock Exchange of Hong Kong Limited on 16 July 2007. Today, Fosun has established four business engines comprising “insurance, industrial operations, investment and asset management”. It is dedicated to becoming a world-class investment group underpinned by the twin drivers of “insurance-oriented comprehensive financial capability” and “industrial-rooted global investment capability”. With regards to its investment philosophy, Fosun has been persistently taking roots in China and investing in China’s growth fundamentals, while grasping investment opportunities evolved from the changing lifestyles of the middle class in China and global economic transformation. It is dedicated to applying the value investing principle to its investment model of “Combining China’s Growth Momentum with Global Resources”, striving to become a China expert with global capacity, with a view to creating value for the society and its shareholders.

In practice, Fosun relentlessly builds up its capabilities in identifying and capturing investment opportunities in China, improving the management and enhancing value of the investees, and establishing a multi-channel financing system to access quality capital. With a value chain based on these three core competencies and a group of entrepreneurs endorsing Fosun’s corporate culture, a solid foundation has been laid for the continuous rapid growth of Fosun. While pursuing economic development, Fosun also shares the fruitful results of development with its staff, partners and the community, taking the initiative to contribute to the society in return. Meanwhile, Fosun also actively contributes its efforts to improve the business and natural environments of China so as to support the rejuvenation of the Chinese economy and culture.