Korean conglomerate Prime Industrialhas acquired Seoul-based production company LJ Film in a move to expand intothe entertainment sector.
LJ Film is reportedlyexchanging $18.1m in stocks with Innotz, a subsidiary of major Korean softwarefirm Haansoft, which in turn belongs to the Prime corporation.
Prime - which has corebusinesses in development and construction, IT, finance and cultural industries- has plans to create a $50m fund through Innotz for production andinvestment/distribution of 15 Korean films and 10 foreign films a year. This putsthe company on a par with Korean majors such as CJ Entertainment and Showboxwhich run funds of $50-60m.
Owner of Seoul's Technomart,site of the first CJ CGV multiplex, Prime is currently building a 25-screenmultiplex in a second Technomart, with plans to develop 180 multiplex screensin its own buildings across Seoul within the next four years. Stock marketanalysts consider this a sign that Prime might give major exhibitors CJ CGV,Megabox and Lotte a run for their money.
LJ Film is best known forinternational arthouse fare such as Kim Ki-duk's Spring, Summer, Fall, Winter...and Spring as well as this year'sSundance competitor The Peter Pan Formula.Since its separation from CJ Entertainment at the end of 2005, the company wasknown to have been looking for a new financier that could provide multiplelevels of support to its films.
LJ Film stated that it"chose Innotz because, more than simple investment, it has infrastructure thatcan provide full support not only to production and management, but also futuredistribution and exhibition, and even digital content development."
The merger comes on a waveof Korean production companies such as Popcorn Film and Tube Entertainmentgoing public by merging with already listed companies, after the successfullisting of other production houses such as MK Pictures, iHQ, and Sidus.