China’s Internet giant LeEco‘s affiliate Le.com announced the 100% acquisition of its affiliate Le Vision Pictures, one of China’s largest movie producers and distributors, for up to RMB 9.8 billion (USD 1.5 billion). The buyout will be paid with stocks and cash, accounting for 69.6% and 30.4% respectively.
Founded in 2011, Le Vision Pictures covers movie production, movie distribution, copyright operations and business development. Mystery movie The Bullet Vanishes is among several hits it has produced, and the company has signed some of the most well-known filmmakers in China including Zhang Yimou and Guo Jingming.
According to the China Film Industry Report 2014-2015 by Entgroup, a firm that provides data on China’s film and television industry, Le Vision Pictures was the sixth largest movie distributor in China and enjoyed 4.1% of the market in 2014. Its box office income saw a rapid growth from RMB 608 million in 2012 to RMB 2,283 million in 2015. In addition, the company has landed two rounds of financing by the end of 2014.
But instead of going public independently, Le Vision will be entirely acquired by Le.com and integrate its IP with other industries that LeEco has covered.
“Now, our focus is on integrating movies with the internet ecosystem,” said Zhang Zhao, the CEO of Le Vision. “If we succeed, Le Vision is expected to be valued for more than if it was listed independently.”
With the acquisition, Le.com will have three major IP subsidiaries, namely, Leshi Zhixin, Flower Film, and Le Vision Pictures, further improving Le.com’s IP ecosystem that connects film with TV, online distribution with offline distribution, IP with users, and the domestic market with the global market.
For Le.com, resources such as scripts and scriptwriters can be shared among its self-made products ranging from movies and TV dramas to web dramas and variety shows. For Le Vision Pictures, the same IP may develop from a novel into a movie, a web drama or even a variety show, covering various platforms and terminals.
(Top photo edited from Baidu Images)