TwentiethCentury Fox International is establishing a theatrical and home entertainmentventure in Russia.Michael Schlicht, founder of leading Russiandistributor Gemini Film, will serve as managing director of Fox's new Russianbusiness.

GeminiFilm's Russian office, which had been Fox's partner in Russia for morethan a decade, will now become Twentieth Century Fox Russia, and all itsRussian employees will be Fox employees. The office is based in Moscow.

Fox will distributeGemini titles in Russiaand other Commonwealth of Independent States areas, while Gemini will continue tooperate in the Ukraineand Siberia,where it will handle Fox titles.

Fox'sInternational co-presidents Paul Hanneman and Tomas Jegeus noted that Fox would "actively seek to produce andacquire Russian movies for distribution, both within Russia andinternationally."

Geminireleased Fox's current hit Ice Age 2: The Meltdown, which took $8.58m during its openingweekend, breaking the Russian records for a Fox film, an animated film, and anon-Russian film.

The firstTwentieth Century Fox Russia release will be local production Piter FM on April 20, followed by X-Men: The LastStand on May 25.

"We arevery excited about the launch of our Russian operation," said Christian Grass,executive VP, Europe,Middle East & Africa, for Twentieth Century Fox International. "Russia isnow one of the top ten international territories in terms of revenue and overthe last five years we have watched the market grow more than six-fold ($65m gross box office in 2001 vs. $420mprojected in 2006). The improvements in the exhibition sector and theresurgence of local films have ignited a revival of the Russian filmindustry. We are equally delighted that Michael Schlicht, who issuch a force in the Russian market, has joined us as our managing director. Hehas done a fantastic job of handling Fox's product and his astute insight intothe business will be invaluable in helping Fox to play a major role indeveloping that market."

GaryFerguson, senior VP of Twentieth Century Fox Home Entertainment International,noted that piracy was still "a huge concern for the DVDbusiness right across Russia and the CIS states, but we're finally seeing thetide turn in the industry's favour."

Fox hadalready made inroads in the Russian film industry with its internationalacquisition (outside of Russia)of Russian hit Night Watch, itssequel Day Watch and the plannedthird instalment, DuskWatch.