Mainland Chinese media mogul Li Ruigang has become a part of a consortium that controls Television Broadcasts. It is the first time that Hong Kong’s leading free-to-air broadcaster has allowed mainland influence in its boardroom.
Li has not become a director of TVB, but instead has become a shareholder in Young Lion Holdings, a private consortium with 26% voting rights. Young Lion is controlled by TVB’s chairman Charles Chan, Taiwanese business lady Cher Wang and Providence Equity Partners.
It has been reported that the Hong Kong government’s Communications Authority Wednesday approved changes to TVB’s shareholding structure. Details were not provided by TVB in its annual report or lists of directors and their functions which were also published Wednesday.
However, it is understood that shares in Young Lion were sold to China Media Capital, the state-backed private equity fund that Li founded in 2009. Neither the scale or value of the stake has emerged.
“TVB thinks having Li on board will benefit its entry to the vast mainland TV and film markets, as well as getting into the international market through his good connections. The station finds the local market too small for its future development,” TVB group CEO told the South China Morning Post.
Li is the former president of Shanghai Media Group. He stepped down in January, but retains the post of chairman at SMG. Through the joint operation of SMG and CMC, Li is involved with at least three Hollywood-facing business partnerships, including Oriental DreamWorks, an alliance with Disney, and CMC Creative Fund, an alliance with Warner Bros., RatPac and advertising giant WPP.
The move comes at a time of huge turmoil in the Hong Kong media and political scenes. Asia Television, which for many years has been TVB’s only free-to-air competitor, has been stripped of its license and is scheduled to cease broadcasting in March next year, but may collapse before that. Meanwhile other broadcasters have been given approval in principle for the free to air sector and other companies are seeking ATV’s radio frequencies.
Social tensions between Hong Kong and China are also heated, having been stirred by huge numbers of mainland visitors to the city, parallel trading activities and the process of political reform. Wednesday also saw the Hong Kong government finally make definitive proposals on elections by universal suffrage. On current trends, these proposals are expected to be vetoed by Hong Kong lawmakers.