Alibaba to Take Majority Control of Alibaba Pictures
Chinese e-commerce giant Alibaba is to take majority control of its films unit Alibaba Pictures. The $160 million (HK$1.25 billion) deal was announced Monday.
The companies said that Alibaba would increase its stake in Hong Kong- and Singapore-listed Alibaba Pictures through a share subscription. It will lift the parent company’s stake from 49% to 51%, and have the effect of changing Alibaba Pictures into a full subsidiary, instead of an associate, from March next year.
Alibaba Pictures has businesses including film investment and production, a major online ticketing operation, and marketing and distribution support for its own and third-party movies. It is currently heavily loss-making and operates within Alibaba’s larger Digital Media and Entertainment Group. The group also includes loss-making video streaming platform Youku.
“The Digital Media and Entertainment business group has made great strides in implementing the ‘happiness’ aspect of our ‘Double H’ strategy,” said Alibaba group CEO Daniel Zhang, in a prepared statement. “We look forward to greater integration and synergies between Alibaba Pictures and related businesses in Alibaba group in both content production and distribution to deliver high-quality experiences for consumers in China. The proposed share purchase is a vote of confidence in Alibaba Pictures, and we will continue to invest resources and take full advantage of our ecosystem to help Alibaba Pictures tap into the promising growth prospects of China’s film industry.”
“As an Internet film and TV company we can leverage the group’s edge in big-data technology and e-commerce, and enhance cooperation with Alibaba’s other digital and media businesses including Damai, Youku, and Alibaba Literature,” said Fan Luyuan, CEO of Alibaba Pictures.
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