A year after taking Relativity Media into its second bankruptcy, Ryan Kavanaugh has reemerged with big plans to get back into film production.
This time, the former Hollywood boy wonder has set up shop in China. In an announcement on Wednesday, Kavanaugh said he intended to develop a world-class film studio and theme park in Foshan, in southern China, and produce up to 10 films a year.
Kavanaugh’s company, Proxima Media, has teamed with National Arts Entertainment and Culture Group Ltd., a tourism and media company based in Hong Kong. The company issued its own statement on Tuesday, saying it has reached an agreement with Kavanaugh, under which he will raise a $100 million investment within the next nine months. The identities of the investors — if any have been secured — was not disclosed.
Kavanaugh has a track record of making such promises. Relativity Media first declared bankruptcy in 2015, and emerged a year later with plans to raise $100 million in equity. The financing never materialized, and Relativity went bankrupt again last year, ultimately selling to its largest creditor, UltraV Holdings.
National Arts is a publicly traded company on the Hong Kong exchange, with a market cap of HK$1.58 billion ($200 million). The company has a studio in Foshan, which is about 100 miles from Hong Kong. According to the company’s annual report, 130 film crews shot at the facility last year.
The studio also has a hotel and welcomes visitors for carnivals and weddings. The company has some limited experience in film production, having invested in a “charity film” called “Our Days in 6E,” according to its report. The company has about 500 employees, almost all of whom are in mainland China, and reported a loss for 2018 of HK$415 million ($52 million).
National Arts issued a statement on Tuesday that it had reached a “potential strategic investor agreement” with Kavanaugh’s company. Under the agreement, Proxima is expected to use its “best efforts” to raise $100 million over the next nine months. The goal is to transform the studio into “a world-class film-induced tourism base.” The company said Kavanaugh will produce up to five films a year — not 10 — in addition to three TV shows.
“We’re going to make movies that are commercial — action, thrillers, romance,” Kavanaugh said in an interview with Variety from Hong Kong. “We hope to maximize profits in both countries.”
National Arts said Kavanaugh’s company would assist in building an indoor studio and a “major modern shooting water studio” to attract “large-scale films.” The plan also calls for upgrading the hotel to “seven-star” status in order to lure international film stars.
Kavanaugh said his plan also calls for developing replicas of global tourist destinations, including the Venice canals, Central Park, Paris and the Hollywood Walk of Fame, to allow Chinese tourists a chance to see the sights close to home.
“This truly will be the start of a new era,” Kavanaugh said in his press release. “Now we have both the right place, the right time, and the clear demand to create both a physical and virtual east-west content powerhouse.”
Should the investment come to fruition, Kavanaugh would end up with 25% of the joint venture, which would go by the name the World Studios.