WPP, Time Warner and Softbank are among the corporates that are set to invest in a fund currently being raised by Chinese government-backed investment fund China Media Capital sized at a “few hundred million” dollars, Bloomberg has reported, citing fund chairman Li Ruigang.
China Media Capital targets media assets, initially in China, though overseas investment is likely later, with consistent cash flow, a strong market position, established branding, and high growth potential. Founded in 2009 with an initial investment of RMB5 billion ($806m), it typically invests between RMB140m ($22.6m) and RMB480m ($77.4m) each time. Investors also include gaming and entertainment provider Crown Resorts.
The fund will aim to profit from the surging Chinese box office, which is now below only North America as the world’s largest cinema market. Media conglomerate Time Warner, one of the investors in the round, and US studio Dreamworks are among its partners in China.
“In this country, you can see the population of the middle class, it is growing so fast,” Li told Bloomberg. “They want to spend money not only to buy luxury goods, they also want quality entertainment, quality content.”
The US dollar fund will invest in television, radio, advertising and cinema space, as well as internet and mobile-phone projects. WPP CEO Martin Sorrell confirmed that the UK-based advertising and marketing firm would be investing more than $10m.