China firm buys AMC to create cinema giant

Wanda, a property group owned by one of China's richest men, said on Monday it would buy US cinema chain AMC Entertainment for $2.6 billion, adding it would create the world's biggest movie theatre owner. Analysts said the deal would give Wanda, whose interests range from commercial property to film production, greater access to the US market -- a key aim for the rapidly growing Chinese movie industry. "This is about Chinese money purchasing something that could allow it to gain access to a market," Teng Jimeng, professor of film at Beijing Foreign Studies University, told AFP. "It will allow China to exercise a kind of soft power influence by gaining this kind of movie theatre chain," he said. Wanda was founded by tycoon Wang Jianlin and owns 86 movie theatres in China, with a total of 730 screens, while it also has interests in film production and distribution and a football team in the northeast city of Dalian. Wang, who was ranked as China's sixth richest person last year with a personal fortune of $7.1 billion, according to the independent Hurun Report, said the purchase would turn Wanda into a "truly global" cinema owner. Wanda will invest a further $500 million in AMC for future initiatives, the companies said in a joint statement. "Wanda will acquire AMC, creating the world's largest cinema owner," the statement said. Privately-held AMC operates 346 multiplex theatres mostly located in major US and Canadian cities with a total of 5,034 screens. AMC's headquarters will remain in Kansas City in the US after the deal, the statement said. The firm also has theatres in Asia. "As the film and exhibition business continues its global expansion, the time has never been more opportune to welcome the enthusiastic support of our new owners," said Gerry Lopez, chief executive officer and president of AMC. The agreement is the latest in a series of movie industry deals as Chinese and US companies seek greater access to each other's markets. DreamWorks Animation announced a Chinese joint venture to make films for the domestic market in February, while Walt Disney said in April it had joined an initiative to develop Chinese animation productions. Disney will also co-produce and partly film Iron Man 3 in China with DMG Entertainment, as Hollywood seeks to tap into the Asian nation's fast-growing movie market. Teng said Monday's deal could also allow greater access to the booming Chinese market for US movie makers. "AMC can also use Wanda to reach into the huge Chinese market, to run American films," he said. Imports of foreign films to China on a revenue-sharing basis are currently limited to just 34 annually, though that was raised from 20 earlier this year.