The Chinese are coming — to your local movie theater. With the fanfare from Superman, and toasts of red wine, representatives of Chinese company Wanda signed a deal in Beijing Monday morning to buy AMC, the second-largest theater chain in the USA.
If approved by U.S. and Chinese regulators, the $2.6 billion acquisition will create the world’s largest theater group, the companies said. The move, China’s biggest corporate takeover to date in the USA, highlights the rising financial strength of its top firms.
Both partners stressed they plan no changes to the AMC brand, management and day-to-day operations. For the U.S. movie-goer, the AMC experience will change “not at all,” insisted Gerry Lopez, CEO and President of AMC, except for an increase in renovations to upgrade some theaters.
“We have no plan whatsoever to promote Chinese movies in the U.S. market,” said Wang Jianlin, Chairman and President of Wanda. A Communist Party member who sits on the nation’s top advisory council — and one of the richest people in China — Wang admitted that poor content was a major reason for the lack of Chinese movie success overseas.
“If China has (a movie like) Avatar, it may really ‘go abroad,’ right?” he said.
A string of Hollywood blockbusters in recent months has lifted AMC back into profit this year, said Lopez. From humble roots in Kansas City, where it remains headquartered, AMC has over 18,000 employees, he said. “We like to say, ‘we make smiles happen’,” said Lopez. “Today, here in Beijing, so far from home, we like to think we have made some smiles happen.”
He was definitely not in Kansas anymore, the city or state. China’s movie market, the second largest after the USA, is growing fast through expansion of theater chains such as Wanda’s, often located in the upscale mall and hotel properties it owns, including the ritzy location of Monday’s signing in Beijing’s central business district.
But the movie business here also reflects the central contradictions of modern China, where the movie world’s standard glamor and deal-making must accommodate a ruling Communist Party that tightly controls what its citizens can watch on screen.
Among those giving congratulatory speeches Monday was a deputy minister of the State Administration of Radio, Film and Television. SARFT forms a key part of the machinery of state cultural control that limits the number of Hollywood films imported each year, and censors all film scripts before movies are shot within China.
Beijing is investing heavily in projecting its “soft power,” or cultural influence, by boosting Chinese state media’s presence abroad, including the USA, where the Chinese government has also run advertisements in New York’s Times Square.
Without reforms that give directors and other artists more freedom over content, that “soft power” push will face difficulties, say some commentators. The Communist movie epic Building a Party, a massive hit here thanks partly to state-funded tickets and bussed-in audiences, met “a mediocre response when shown in the USA,” wrote Liu Yuanju in Time Weekly newspaper last week.
“Even if Wanda controls the AMC chain, pays no heed to box office, increases the film’s showings, and make up the losses with domestic resources, acting like this will defeat the purpose of exporting culture and even values — clearly, it will only provoke resentment,” said Liu.