Wanda to partner with South Korea's CJ CGV?
Wanda Cinema Line, China’s biggest movie theatre operator, is in talks with CJ CGV, South Korea’s largest movie theatre chain, possibly with a view to partnering up in China.
A subsidiary of Wanda Group, owned by China’s richest man, Wang Jianlin, Wanda Cinema Line currently operates 320 theatres in nearly 120 cities in China.
CJ CGV first entered the Chinese market in 2006 and runs theatres in at least 40 cities across the country, according to its website.
On Friday, local media reported that Wanda Cinema Line was entering into a partnership with CJ CGV in China.
Citing several ‘independent sources,” movie news website Yiyu Guancha said the two companies were close to a decision about partnering up in China’s cinema market.
Wanda confirmed to China Film Insider that it is in talks with CGV but would not disclose any details about any reported partnership.
The purported move by Wanda Cinema Line to partner up with CJ CGV rather than buy it outright is unusual for the acquisitive media conglomerate.
The total amount of purchases completed or announced by Wanda companies recently topped US$16 billion for this year, according to data compiled by Bloomberg.
The potential for the powerful rivals to consolidate their efforts comes as competition in the country’s cinema-building industry heats up with new players entering the field.
Elsewhere on Thursday, it emerged that Alibaba Pictures was planning a move into the construction and operation of cinemas in China.
An Alibaba spokesperson confirmed to China Film Insider that the company has a team dedicated to the cinema business, but did not go into details about that team’s plans.
That followed the successful initial public offerings of both China Film Co. and Shanghai Film Group, two major state-owned enterprises who plan to use funds raised to build new cinemas.
The news also comes as geopolitical issues have overshadowed Korean entertainment companies’ plans in China, making partnering up with an influential local firm desirable for CJ CGV.
In June, Wanda Cinema Line CEO Zeng Maojun said on the sidelines of the Shanghai Film Festival that there was still plenty of room for growth in the investment and construction of theatres.
China currently has fewer than 40,000 screens, a number Zeng says could rise to 120,000 based on the United States’ example.
“But 80,000 screens is probably more reasonable for the Chinese market,” Zeng said. “Growth will probably start to slow down once we break the 70,000 mark.”
But the race to build new cinemas comes at the same time as national box-office takings have started to slump. National box office dropped five percent in the second quarter and 18 percent in July, according to data from the Beijing-based Ent Group.