Bona-21st Century Fox Deal Solid, Says Yu

Yu Dong, CEO of Bona Film

Pure-play Chinese film company to expand vertical integration

LOS ANGELES — The 19.9% share stake in China’s Bona Film Group held by 21st Century Fox is unlikely to be sold any time soon, Bona’s boss Yu Dong insists.

The stake was acquired by the then News Corporation in May 2012, a year and a half after Bona floated on the NASDAQ stock market.

But there have been numerous question marks as to whether the holding will continue.

The disposal of News Corp.’s shares in Star TV China, last month’s sale of its shares in Phoenix Satellite Television and the poor performance of Bona’s American Depositary Shares, have all been cited as evidence of the group’s waning interest in China. 

“The separation of News Corp. into two parts has actually helped us, as now we have a more direct connection,” Yu told Variety. “What was previously a financial relationship has now become a strategic relationship.”

Purchase of the stake was widely credited to Wendi Deng, wife of News Corp. boss Rupert Murdoch. But the June announcement of their divorce has added to the speculation that the Bona-Fox relationship is headed for the rocks.

“Despite what people think, Wendi Murdoch was a supporter of our deal, not the connector. The initiator was Jack Gao,” said Yu. 

Gao, who sits on Bona’s main board of directors, was senior VP, News Corporation & CEO, News Corporation China Investments. 

“One of Bona’s unique advantages is its vertically-integrated business model, which differentiates the company from other film distributors in China,” said Gao at the time.

“Bona is largely a pure-play film company, unlike some we are compared to,” said Yu. “Our biggest strategic goal is to build the full value chain, expanding production to 15 films per year through our new RMB1 billion fund ($165 million), and adding a further 30 multiplexes in the next years.”

Bona and Fox International Productions, 21 Century Fox’s specialty overseas film-making unit, are co-producers on the upcoming “Moscow Mission.”

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