Notable Increase in the Ability to Allocate Resources of the Cultural Industry Market
Against the backdrop of the 2016 “capital winter”, cultural, sports, and entertainment spaces became the new “eye of the storm” pursued by investors, and the cultural industry saw unabated investments and M&As during the year. According to statistics, Shanghai’s cultural companies completed 141 equity investment and financing activities, involving RMB 18.26 billion in capital. Of those activities, two-thirds were carried out by Internet-related companies focusing on culture and information, and RMB 8.34 billion was linked to 21 M&As conducted by Shanghai’s cultural companies. As to listings, Shanghai Film Co., Ltd. was listed on the Main Board on the Shanghai Stock Exchange, becoming China’s first state-owned local film company to go public.
Backbone Cultural Companies Stepping Up for Global Development
In 2016, eyeing global markets, some 10 backbone film and TV and gaming companies in Shanghai stepped up their global action to improve their capacity to use, control, and allocate global resources.
In the film industry, Fundamental Films acquired a 100% stake in FF Motion Invest Co., Ltd. (hereafter “FF Motion”) for EUR 60 million (about RMB 0.45 billion), and plowed about EUR 0.53 billion into subscribing to 11,428,572 new direct shares issued by EuropaCorp S.A. (hereafter “EuropaCorp”) for FF Motion. The deal was completed, and FF Motion now holds 27.9% of EuropaCorp’s share capital, becoming the second biggest shareholder of that world-class film company.
The two companies have co-operated many times before, releasing films internationally such as Brick Mansions, Lucy, Taken 3, and The Transporter Refueled. This deal was a major move for Fundamental Films in terms of its internationalization strategy, deepening ties between the Chinese, European, and the US film industries.
Entering the International Market with a Commercial Operating Model
In recent years, Shanghai has actively driven excellent cultural and arts programs into the international market using market-based strategies. In April 2017, the Shanghai Ballet presented five performances of its “Swan Lake” at Melbourne’s Regent Theatre, which marked the first large-scale commercial performances ever put on by a Chinese ballet to an Australian audience in the form of a full classical ballet, with an attendance of 90%. Later, the Ballet embarked on a major tour of Europe, with 40 performances in 9 cities in the Netherlands and Belgium, including 18 performances in Amsterdam’s Royal Theatre Carré, which broke the theatre’s 30-year record. In May of the same year, the opera “The Wager” was jointly presented in London’s Silk Street Theatre by the Guildhall School of Music and Drama and the Shanghai Opera House.
The favorable geographical location, economic strength, and deep-rooted cultural background, coupled with the continuous introduction of preferential policies, have enabled Shanghai’s cultural trade to flourish. Today, Shanghai has fully opened its cultural industry to the outside world. Culture-related government departments have made endless efforts to optimize the service system and improve the efficiency and effectiveness of the trade process, to further drive the development of cultural trade in Shanghai.