Huayi is China’s largest private sector film production and distribution company and is separately negotiating a major production and investment deal in the U.S. that is expected to close on April 1. The U.S. partner is understood to be STX and the deal span up to 18 movies.
Showbox has activities ranging from investment, production, distribution and international sales. It also owns a small chain of cinemas in China that operates under the Megabox brand.
According to the terms of their deal, Showbox will be responsible for discovering projects, which Showbox China will then develop and localize. Once screenplays are complete, Showbox and Huayi will jointly make investment decisions. Chinese distribution and marketing will be handled by Huayi.
“We expect this partnership with Huayi Brothers, the top Chinese studio that has strong production capability and distribution network, to help Showbox head to the global market. I am confident that Showbox will establish itself as a positive brand that ensures future profits in China,” said Yoo Jeong-hun, Showbox’s CEO in a prepared statement.
Head of Huayi Wang Zhonglei added, “It is very meaningful to have this opportunity to produce and release the globally competitive Korean contents in China.”
The two companies previously co-produced a Showbox-initiated sports drama film, 2013’s “Mr. Go 3D,” which was a hit in China but a disappointment in Korea.
The deal is very much in line with the current alignment of the Korean and Chinese film industries. China’s growing commitment to the Korean entertainment industry has encouraged Chinese companies to use their financial influence in the neighboring country: Chinese film and TV production group Zhejiang Huace became the second largest stakeholder of leading Korean distributor Next Entertainment World, with a $52 million investment in late 2014.
The pact is also expected to sweeten relations between the two countries, following the co-production treaty signed at state level last September that loosens the quota restrictions for Korea-China co-productions.