Chinese film distributor Bona Film Group has filed to list its shares on the NASDAQ stock market in New York, aiming to raise $80m in an initial public offering. It will be the first Chinese film company to be listed in the US.
Bona is currently one of the biggest privately-owned film companies in China, engaging in film investment, production and distribution. It also owns a talent management firm and a cinema management company.
The company aims to use the funds raised in the IPO, which is expected early next year, for investments in film production and distribution. It also plans to acquire cinemas in China. Bank of America Merrill Lynch, JP Morgan and the China Investment Capital Corp will handle the transaction with Cowen & Co and Piper Jaffray underwriting the IPO.
Founded by Yu Dong in 1999, Bona started as a film distribution company with state-owned China Poly Group, a commercial wing of the Chinese army, as its majority shareholder. It quickly became renowned for successfully distributing Hong Kong films in mainland China.
Bona was also one of the first Chinese film companies to receive investment from private equity companies. Between 2008 and 2009, Bona received two rounds of private equity financing from companies including SIG Asia, Sequoia China and new financier Matrix China. After receiving this investment, Poly Group’s stake was diluted to a small minority share.
Bona ramped up investment in film production in 2008 and this year is the major investor in Tsui Hark’s 3D action drama Flying Swords Of Dragon Gate and Chen Daming’s Chinese remake of Paramount’s What Women Want.
In 2009, Bona’s revenues were $32.4m with a net profit of $1.2m. In the first three quarters of 2010, Bona’s revenue reached $35m but showed a loss of $7.5m.
Bona’s planned IPO signifies a trend in China’s booming entertainment industry to seek investment from the stock market. In late 2009, Huayi Brothers Media was the first private film production company to be listed. Last month Hangzhou-based Zhejiang Huace Film and TV filed for an IPO. Both companies went for a listing on the ChiNext board of the Shenzhen stock market.
Meanwhile, Chinese online-video sharing site Tudou Holdings filed for an IPO on the Nasdaq on Nov 10. The following week, Youku.com, another online video company, filed for an IPO with the New York Stock Exchange, seeking to raise as much as $150m.