During future China leader visit, DreamWorks signs China deal

By Andy Goldberg Feb 17, 2012, 20:12 GMT

Los Angeles - Dreamworks Animation, the studio behind Shrek, Kung Fu Panda and other animated blockbusters, announced a 330-million-dollar joint venture Friday with three Chinese media companies aimed at producing original Chinese animated and live action content.

The deal was announced to coincide with the Los Angeles visit of Chinese Vice President Xi Jinping, who is on a good will tour of the United States before he assumes China's presidency next year.

Under the terms of the agreement, the Hollywood studio will combine with China Media Capital (CMC), Shanghai Media Group (SMG), and Shanghai Alliance Investment Ltd (SAIL), to establish Oriental DreamWorks, a company that will also pursue opportunities in live entertainment, theme parks, mobile, online, interactive games and consumer products.

The new venture will construct a new animation facility in Shanghai, according to the statement.

Calling the move a 'groundbreaking and historic alliance,' DreamWorks Animation's CEO Jeffrey Katzenberg said the new venture would 'conceive, produce and distribute high-quality creative content and family entertainment experiences - not only for the people of China but also for related export markets.'

Currently China allows only 20 foreign films to be distributed there per year and the new venture will likely help DreamWorks' films circumvent that restriction.

'Oriental DreamWorks will be in a unique position to create high-quality content and interactive entertainment products for China and international markets,' Ruigang Li, Chairman of China Media Capital, said in the statement.

Under the terms of the deal, the Chinese companies will hold a 55- per-cent stake in the new venture, with DreamWorks owning the rest.

DreamWorks has been one of the most successful Hollywood studios in China, led by its blockbuster Kung Fu Panda franchise. Kung Fu Panda was the top animated film upon its release into China in 2008 and last year, Kung Fu Panda 2 became the highest-grossing animated film of all time in the region, grossing approximately 100 million dollars there.

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