AOL Time Warner Buys Into Shanghai Movie Theater Chain
AOL Time Warner, in a move into the growing Chinese entertainment
industry, has purchased a 49% stake in Shanghai Yongle
Co.
While the total money investment is very small at only
US$1.7 million, it is a rare expansionary move for the
media giant, which has recently been in trouble because
of the AOL acquisition. Last year, it wrote off more than
US$100 billion in losses, in one of the biggest corporate
write-downs in history.
This move puts AOL Time Warner ahead of other cineplex
chains such as Village Roadshow Ltd., which is big in
Europe and Asia. Yongle is the leader in box office receipts
in China, operating 57 cinemas in and around Shanghai.
It took in nearly 30 million yuan (US$30 million) in receipts
in 2002. Depending on how active a partner AOL Time Warner
is, it is in a position to drive rapid growth in this
sector, which has plenty of room for growth.
Movie theaters are a popular form of entertainment in
China, especially for young people. Most families have
their own DVD players at home.
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