Viacom's Paramount nets $1B from Chinese investors
January 23, 2017
Two Chinese film companies, Shanghai Film Group (SSE: 601595) and HuaHua Media, have agreed to provide the all-cash investment to Paramount Pictures in return for financing rights to 25% of the studio's films during the next four years, according to Reuters. The deal comes as Viacom (NASDAQ: VIAB)—Paramount's parent company—and new CEO Bob Bakish look to improve the fortunes of its struggling cable television portfolio (which includes Comedy Central, MTV and Nickelodeon) after merger talks with former broadcast partner CBS (NYSE: CBS) fell through late last year.
Paramount joins rivals like Warner Bros. and Disney by turning to Chinese investors to help fund their films and boost distribution overseas. Of late, the most important Chinese presence in Hollywood has been Dalian Wanda, which bought AMC for $2.6 billion in 2012 and took a $3.5 billion controlling stake in Legendary Entertainment last year. And for HuaHua—which agreed to be acquired by Oriental Times Media (SZSE: 002175) earlier this year—the deal has a certain familiarity: The company has in the past partnered with Paramount to fund several films, including "Transformers: Age of Extinction" and "Star Trek Beyond."