SMI issued new stock to Yeung at HK$0.21 per share, a discount of 8.7% to their price at the close of trading on Friday. He paid $14.5 million (HK$112 million) for the 6.11% stake of the enlarged capital. SMI said that the proceeds will be used for working capital and reduction of liabilities.
SMI directly operated 56 multiplexes in mainland China, with some 398 screens, as of June last year.
Yeung heads an empire of property, finance, jewelry and media activities in Hong Kong and China. Last year he announced that EMP would expand into the mainland cinema business through a strategic partnership with Hong Kong’s UA Cinemas chain.
The first cinema under the UA partnership is a 12 screen complex in Nanhai VivoCity in Foshan set to open in in the coming months. It will be the first five-star luxury cinema in Foshan and seat 1,500. UA and Emperor are examining other sites in Foshan, Dongguan, Shenzhen, Wuhan, Chongqing and Shanghai.
UA and EMP already collaborate in film distribution in Hong Kong. EMP produced 2012 hit “The Viral Factor,” financed “The Great Magician,” and was the HK distributor of “Personal Tailor” and “Chinese Zodiac.”
SMI Corp. also provides marketing and advertising services and is a minority investor in TV series and movies, including last year’s hit “American Dreams in China.”
The mainland Chinese movie sector is booming. Last year some 5,077 new cinema screens were added, lifting the nationwide total to 18,195. Theatrical box office grew by 28% to RMB21.8 billion ($3.37 billion).