Hong Kong, whose once famous studios now lurk like decrepit ghosts, is about to take Asian film and TV on new thrill ride.

Celestial Pictures, which will be a vertically integrated studio operation spanning production, distribution and broadcast, is poised to unveil its debut slate. A series of pan-Asian film channels will follow within months.

One industry insider described the move as: "the most significant thing to happen to Hong Kong cinema over the last five years."

The company is headed by William Pfeiffer, a 20-year veteran of Asian media and until recently executive vice president, Columbia TriStar International Television Asia. It is backed by Usaha Tegas, the privately-owned media empire belonging to Malaysian tycoon Ananda Krishnan. Its other assets include the Measat and Astro satellite operations and the Maxis mobile phone company.

Celestial started life when it paid for $77m (HK600m) for the 760-title Shaw Brothers feature library early last year. It now owns all rights, in perpetuity. But Celestial took on a new dimension when Pfeiffer, who had pursued the same catalogue for Sony, persuaded Krishnan that the collection was merely the backbone for something much bigger.

"What we are developing is a vertically-integrated, Asian-language, focussed entertainment company," said Pfeiffer. "We are looking at the world-wide Asian market, not just those living in Asia. This is a strategy that proved itself at Sony."

The films, which include classics such as The One-Armed Swordsman and The Five Deadly Venoms, are now being restored and digitally remastered with an initial investment of $14.8m (HK$115m). Celestial sees the films being released by its new TV arm, on DVD and possibly theatrically.

Theatrical release is the firm target of Celestial's development and production arm. Headed by the celebrated and prolific actor-director-producer Wong Jing this is planning an initial slate of 12-15 pictures. These are likely to include some remakes of classic Shaw titles, but is likely to also include original material in a number of different Asian languages Although Pfeiffer would not confirm, Stephen Chiau, the director of recent smash hit Shaolin Soccer, is widely rumoured to be on board. Celestial will unveil its debut slate in January.

Once up to speed, feature production could exceed 20 films a year. TV programming and animated series are also on the agenda and being developed.

At the same time Celestial is negotiating carriage deals on cable and satellite networks in Asia and around the world. It envisages rolling out a bouquet of film channels from mid-2002. The first is likely to be a Chinese-language channel, which includes Japanese and Korean films in its mix. "We are acquiring as many films as we can reasonably get our hands on. They are a mixture of first run and library pictures."

While the whole Celestial project could involve total investment approaching $100m, before it starts to see any revenues, Pfeiffer said: "we are strongly supported and backed by Usaha Tegas. It is a long term commitment. We would consider a strategic investor if they brought something with them. But we don't need to that for the finance."

Pfeiffer sees Celestial's multi-media approach as a means to overcome some of the structural weaknesses of film in Asia, such as a lack of adequate theatrical screening outlets and video piracy.