Paramount Pictures and Chinese film company Huahua Media have reached an agreement to end their slate financing arrangement that would have financed 25 per cent of the Paramount film slate in fiscal 2017, 2018 and 2019.The news comes following recent changes to Chinese foreign investment policies.
Despite the dissolved financing partnership, Paramount will continue to maintain its relationship with Huahua and looks forward to exploring opportunities to work together in the future.
Furthermore, Paramount has secured a series of individual financing agreements with partners including Hasbro, Skydance Media and SEGA among others.
These partners will provide committed or expected financing for approximately 25 per cent of the production costs of the studio’s film slate for fiscal 2018 and 2019.
“The actions we are announcing today establish a financing model that is better aligned to Paramount’s new strategic approach to film production,” says Jim Gianopulos, chairman and chief executive officer, Paramount. “Our focus on a more balanced slate–a mix of big, broad-audience films and more targeted and co-branded films made with greater fiscal discipline–demands a more flexible and tailored financing model going forward. This structure positions us to capture more upside beyond 2019 as the new slate takes full effect,” he ends.
Additionally, Viacom, the parent company of Paramount Pictures, expects a negative net impact of $59 million in the fourth fiscal quarter in connection with the termination of the Huahua agreement.
