China tycoon ties up with Singapore firm, entrepreneur to launch US$100-million media fund

A Chinese film tycoon, a Singaporean entrepreneur and a Singapore private equity firm launched on Tuesday a US$100 million fund based in the city-state that will open the way for foreigners to invest in China’s media and entertainment industry.

Local media entrepreneur Calvin Cheng, who put the deal together and will be the fund’s chief investment officer and general partner, said that the fund would look at media companies globally that have a “China story”.

Yu Dong, founder and chairman of China’s largest private film distributor, the NASDAQ-listed Bona Film Group Limited, pointed out that China’s media and entertainment industry is forecast to overtake Japan’s by 2018 to become the second-largest in the world, behind the US.

Andy Lim, chairman of local private equity firm Tembusu Partners, said that the fund would provide opportunities for Singapore companies to make a foray into China’s media industry.

The three parties signed a memorandum of understanding for the fund during the Singapore Media Festival at the Marina Bay Sands.

The US$100 million fund will be a closed-end five-year media fund to be formalised at the end of March next year.

Cheng, a former nominated member of Singapore’s parliament and executive director of media company Lumina-Looque International, said the fund was unique in that it would be the first such fund based out of China and denominated in foreign currency.

He said the fund would also look at international cooperation opportunities between China and countries such as Singapore and the US through co-productions or joint ventures.

Yu Dong said that aside from TV and film, the fund might look at investments involving games and a theme park in China.

Speaking to reporters after the launch, Cheng said that the fund would look for returns in the 20-30 per cent range.

Lim said that anchor investors may likely be Bona Film Group itself as well as Thailand’s Chia Tai Group.

He also said that the fund would be given the right of refusal to invest in the line up of Bona Film’s productions, and it would be up to the investment committee to decide whether to make an investment or not.

He added, however, that there would be a Chinese wall set up to ensure there is no conflict of interest if the fund does so make an investment.

Target investors of the fund will be high-net worth individuals in the region, he said.