Following the completion of the equity transfer agreement, China Film will become the sole owner of the three cinemas which are located in the cities of Changsha and Nanchang. The agreement is still pending the approval of the Chinese government and the process is expected to take 60 working days.
In Nov 2006, WBIC announced that it would halt investment in the mainland China cinema market, due to a regulatory change that prevents foreign companies from owning majority stakes in Chinese cinemas. Six cinemas that were part-owned by WBIC were affected by the withdrawal including the three it owned with SZITIC.
'We are extremely proud of what our international cinema business has accomplished in just four years in China,' said WBIC president Millard Ochs in a statement. 'We believe that China Film Group's experience in cinema operation will help to achieve a smooth hand-over, and ensure that the cinemas keep their service standards and continue to provide improved consumer movie experience.'
'By taking over the Warner-SZITIC cinemas, China Film Group has shown our commitment and confidence to continue developing the Chinese cinema market,' commented Han Xiaoli, China Film Group's newly promoted general manager.
Chinese local media reported last month that the China Film take-over deal was in collaboration with real estate developer Beijing Time Antaeus Group, which operates an e-cinema circuit. A Time Antaeus spokesman said he could not confirm the company's collaboration with China Film at this time, but hoped to announce its involvement in the deal in mid-March.