Shanghai to lead new distrib group

New co. ends ChinaFilm's monopoly on releasing foreign films

SYDNEY — The Shanghai Film & TV Group lost its campaign to win a license to distribute U.S. and other foreign films in China — but it has just secured the driver’s seat in a new distrib co-venture.

The fledgling company, as yet unnamed, which will end China Film’s monopoly on releasing foreign films on the mainland, will be based in Shanghai, and its chairman will be Zhu Yongde, head of Shanghai Film & TV Group, Daily Variety has learned.

Shanghai Group has emerged as the banner’s largest single shareholder, with a 15% stake, indicating the politically well-connected player has triumphed in a power struggle with other regional studios, all of whom were vying to exert as much influence as they could over the new distrib.

China Film, which had been angling for a stake of up to 30%, is expected to be limited to just 8%. It is understood the other investors include Changchun Film Group, Xi’an Film Group, E’Mei Film Group and Xiaoxiang Film Group. The only theater chain to have representation is the Urban Theater Development Assn., based in Chengdu.

New company will take shape in May and begin operating by July 1, according to sources at China Film in Beijing.

The State Administration of Radio, Film & Television has ruled that the 20 foreign films imported annually on a revenue-sharing basis will be divided equally between China Film and the new distrib. There’s no word yet on the first titles that will be handled by the Shanghai-based upstart.

Shanghai Group was given the rights to launch “Jurassic Park III” in January in what was widely regarded by China-watchers in Hollywood as a test of the group’s ability to coordinate a nationwide release.

The dinopic grossed $1.5 million– a respectable figure, considering pirated videos of the title had long been circulating, and its theatrical run was impacted by China Film’s subsequent release of “Harry Potter and the Sorcerer’s Stone.”

At the time, securing “Jurassic” was widely seen as a once-only coup for the Shanghai Group, unrelated to the way the second distrib would be structured or where it would be based. Now it’s clear the folks at Shanghai always had their eye on the main prize of becoming the key player in the new entity.

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