(April 10th, 2007 - Shanghai, China) — Warner Bros. International Cinemas (WBIC), the international cinema division of Warner Bros., and Shanghai Film Group (SFG), a Chinese leading film industry player, announced today that SFG will take over two WBIC Cinemas in China. Located in Shanghai and Nanjing, both the two cinemas are joint projects of WBIC and SFG. Before this taking over, WBIC with its partner SZITIC Commercial Property Co., Ltd. had sold 3 cinemas to China Film Group. In November 2006, WBIC announced that it must stop its investments in cinemas due to a major regulatory change. Warner Bros. remains committed to its other businesses in China, including local language film production, a home video joint venture, consumer products and studio stores all of which have different legal structures, business models and regulatory requirements. The equity transfer agreement was signed by SFG and WBIC on February 12, 2007. According to the agreement, SFG will be buying WB's 49% interest in Shanghai Paradise-Warner Cinema City and 51% in Nanjing SFG-Warner Cinema City. Before this taking over, SFG originally holds 51% share in the Shanghai based cinema and 49% share in the Nanjing based cinema. The agreement is still pending to the approval of the Chinese government, and the process is expected to take approximately 60 working days. “We are extremely proud of what our international cinema business has accomplished in just four years in China and proud to have been a catalyst in turning around a market that has since seen an explosion of new multiplex cinemas across the country,” said Mr. Millard Ochs, President of WBIC. “We believe that as a leading player in China film industry, Shanghai Film Group’s experience in cinema operation will help to achieve a smooth hand-over, and ensure that the cinemas keep their service standards and continue to provide improved consumer movie experience.” Mr. Ren Zhonglun, president of Shanghai Film Group also commented that “WBIC has achieved great success in the past years. By taking over the both joint-venture cinemas, Shanghai Film Group has shown our commitment and confidence to continue developing the Chinese cinema market. We will do our best to contribute to the prosperity of China film market.” After the hand-over, all Warner Bros. logos and other intellectual property will be removed from the cinemas, which will also no longer carry the Warner Bros. name.
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