China's Hunan TV & Broadcast Intermediary Co. will give film studio Lionsgate as much as $375 million in production financing over the next three years, making it the biggest Hollywood deal by a Chinese company to date.
As part of the agreement, financing would cover most of the films on Lionsgate's slate, a person familiar with the situation said Thursday. However, the deal will exclude Lionsgate's blockbuster "Hunger Games," "Divergent" and "Twilight" franchises.
The Santa Monica-based studio and Chinese broadcaster will explore opportunities in TV production and format development. Lionsgate will also help distribute Chinese films in other countries.
The news comes just two months after talks between the companies were confirmed. Hunan TV, the second-largest broadcaster in China after China Central Television, and Lionsgate are expected to formally announce the deal at a press conference Changsha next Wednesday.
Lionsgate has already branched out in the Chinese market. Last summer, the e-commerce giant Alibaba Group and Lionsgate launched a subscription video streaming service for mainland China called Lionsgate Entertainment World.
The deal is just the latest example of Chinese businesses strengthening their ties to Hollywood.
Last year, Shanghai investment company, Fosun International Ltd., made a deal to invest in Studio 8, a film company started by former Warner Bros. Pictures Group president Jeff Robinov.
In 2012, China's Dalian Wanda Group Co. bought the U.S. theater chain AMC in a deal valued at $2.6 billion. The Chinese conglomerate has also recently shown interest in buying a stake in an American movie studio.
Shares of Lionsgate were up about 2%, to $33.10 a share in Thursday trading.
Staff writer Ryan Faughnder contributed to this report.
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