Chinese Continues To Buy Up America, Creates Largest Cinema Business With $2.6bn Deal For AMC
 |
Wang Jianlin has a personal fortune of £4bn Photo: Getty Images
|
Telegraph
On Monday, at a glitzy signing ceremony in Beijing, Wang Jianlin, 57, who has a personal fortune of £4bn and now runs one of China’s largest property developers, the Wanda Group, delivered a coup for China’s attempts to project itself around the world: the purchase of America’s second-largest cinema chain, AMC.
Founded in Kansas in 1920 by Edward Dubinsky, a vaudeville performer, AMC now serves more than 200m moviegoers a year. Until the late 1990s, the company was run by his Harvard-educated son, Stanley Durwood, whose innovations included the multiplex, the armrest cup holder, and “stadium seating”.
AMC, which also has cinemas in Britain, opened the world’s first “megaplex” in 1995, a 25-screen cinema in Kansas, a concept that rivals described as a “death star” because of its terminal effect on independent screens.
Gerry Lopez, the current chief executive, said the injection of at least $500m from Mr Wang would help the group to buy 3D projectors and other technology.
“We will be not only the world’s largest cinema group, but also the strongest,” said Mr Lopez. “We have to give people a reason to leave their homes. And 3D is that – it is a reason to go out, get in your car and drive to the theatre because you cannot experience it at home”.
After an exuberant overexpansion in the 1990s, the entire American cinema business has been struggling under the weight of its debt5s, and several chains have gone to the wall. AMC said the value of the deal included Wanda Group taking on its $2bn or so of loans. Mr Lopez said it was hard to service so much debt during the past year with Hollywood misfiring.
“What has hit us hard, very hard, has been the quality of movies coming out of Hollywood,” he said.
“This year, however, it has reversed. We had the biggest March on record and in May there was The Avengers,” he added, referring to the Marvel superhero film that has grossed more than $1bn at the international box office
Mr Wang insisted it would be business as usual for AMC and its employees. “This is a brand with more than 90 years of history. How could we just write off such a brand? There is no change for the brand or management. The only change is the boss,” he said.
He added that the deal was not part of some propaganda push by the Chinese government.
“There was no mention of promoting Chinese movies during our negotiations,” he said. “Not a lot of Chinese movies can go abroad. The quality and content of the movies is not high enough. If Avatar was produced in China, then surely it would be a success abroad.”
The deal represents a drop in the ocean for Wanda, which runs 49 giant shopping arcades in China, 28 five-star hotels, 730 cinema screens, 40 department stores and 45 enormous karaoke saloons, and which had assets of around $35bn last year.
Mr Wang said it would help burnish his company’s brand, and perhaps gain a foothold for other property deals in the US.
China’s box office take increased by more than a third to $2bn last year, according to the Motion Picture Association of America, making it the third biggest market after the US and Japan.
Hollywood has been anxiously trying to break into the Chinese market, and Walt Disney, DreamWorks and News Corp have all formed co-production units in the past year. Disney said last month it will co-produce Iron Man 3 with Beijing-based DMG Entertainment, while News Corp has bought a stake in Bona Film Group. DreamWorks is setting up an animation studio in Shanghai.
“What has hit us hard, very hard, has been the quality of movies coming out of Hollywood,” he said.
“This year, however, it has reversed. We had the biggest March on record and in May there was The Avengers,” he added, referring to the Marvel superhero film that has grossed more than $1bn at the international box office
Mr Wang insisted it would be business as usual for AMC and its employees. “This is a brand with more than 90 years of history. How could we just write off such a brand? There is no change for the brand or management. The only change is the boss,” he said.
He added that the deal was not part of some propaganda push by the Chinese government.
“There was no mention of promoting Chinese movies during our negotiations,” he said. “Not a lot of Chinese movies can go abroad. The quality and content of the movies is not high enough. If Avatar was produced in China, then surely it would be a success abroad.”
The deal represents a drop in the ocean for Wanda, which runs 49 giant shopping arcades in China, 28 five-star hotels, 730 cinema screens, 40 department stores and 45 enormous karaoke saloons, and which had assets of around $35bn last year.
Mr Wang said it would help burnish his company’s brand, and perhaps gain a foothold for other property deals in the US.
China’s box office take increased by more than a third to $2bn last year, according to the Motion Picture Association of America, making it the third biggest market after the US and Japan.
Hollywood has been anxiously trying to break into the Chinese market, and Walt Disney, DreamWorks and News Corp have all formed co-production units in the past year. Disney said last month it will co-produce Iron Man 3 with Beijing-based DMG Entertainment, while News Corp has bought a stake in Bona Film Group. DreamWorks is setting up an animation studio in Shanghai.
