CMC and UME have not responded to the reports, but publicly available documents indicate the deal is in the offing.
Chinese state-backed investment firm China Media Capital (CMC) will buy Shanghai Siyuan Entertainment Co., Ltd, owner of UME Cinemas chain in a deal valued by insiders at up to RMB3 billion ($460 million), online film news website Mtime reported on Wednesday.
The acquisition, if confirmed, will be the latest expansionary move by CMC, China’s first venture capital fund in media and entertainment, the report said, quoting anonymous sources.
Although the deal has yet to be confirmed, government filings show that as of August 25, CMC chairman, media magnate Li Ruigang has taken over as the person legally in charge of Shanghai Siyuan Entertainment. A CMC subsidiary has also taken over the role of shareholder for the Shanghai-based company.
China Media Capital made news last week after Universal announced the sale of its 45% stake in Oriental Dreamworks, a joint venture in animation with CMC, its majority shareholder. The two companies had sparred over strategic differences, according to Li.
UME Cinemas is an upscale cinema chain with 25 theaters and over 400 screens in major Chinese cities. Founded by and named after Hong Kong director Wu Siyuan, Shanghai Siyuan Entertainment owns UME branches in Beijing, Shanghai, Chongqing, Hangzhou, and Guangzhou which raked in CNY$680 million in box office sales last year.
Additional reporting Amber Ziye Wang
