Nasdaq-listed Bilibili invests $66m in HK-based film producer Huanxi Media

Rui Chen, chairman and chief executive officer of Bilibili Inc., stands for a photograph during the company's initial public offering (IPO) outside of the Nasdaq MarketSite in New York, U.S. Photographer: Michael Nagle/Bloomberg

Nasdaq-listed Chinese online video platform giant Bilibili has entered into an agreement to invest HK$513 million ($66 million) in Huanxi Media, a Hong Kong-based film producer, as the online release of theatrical films has become a new norm in the country after the pandemic.

Hong Kong-listed Huanxi will offer almost 347 million shares to Bilibili at a price of HK$1.48 ($0.19) apiece, a discount of about 2.63 per cent over the closing price of HK$1.52 ($0.20) per share on August 28, yet a premium of approximately 1.37 per cent over the average closing price of HK$1.46 per share for the last five trading days.

The new shares will amount to 9.9 per cent of the company’s overall stake after the issuance, Huanxi disclosed in a filing with the Hong Kong Stock Exchange (HKEX) early on Monday.

Huaxi Media, which counts Chinese renowned directors and actors including Cannes laureates Wong Kar-wai and Zhang Yimou among its shareholders, entered into a five-year collaboration agreement with two subsidiaries of Bilibili as part of the deal.

The collaboration will allow the Shanghai-based video platform to stream its content and share the revenue generated. Bilibili and its affiliates could enjoy priority access to invest in Huanxi’s future film and television projects, as well as to develop derivatives of such content, according to the filing.

Huanxi’s content to be licensed on the Bilibili platforms will “reach a wider audience” and “bring in more revenue” by capitalizing the video platform giant’s extensive user base. Huanxi’s streaming platform, Huanxi.com, is also expected to “grow in popularity and user base” through the collaboration, said the company.

The update comes about seven months after TikTok’s parent firm ByteDance agreed to pay at least 630 million yuan ($92 million) for Huanxi’s new movies and dramas to stream on its video platforms, as the outbreak of the coronavirus pandemic forced mainland cinemas to halt operations.

They included Lost in Russia, a Huanxi-produced film that became China’s first blockbuster that was released entirely online during the Lunar New Year holiday.

In March 2019, Maoyan Entertainment, one of China’s largest online ticketing services provider backed by Tencent, announced a plan to inject 391 million yuan ($57 million) into Huanxi. Maoyan agreed to purchase 236 million shares of Huanxi for HK$1.65 ($0.21) apiece.

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Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.