The film and television industry mergers and acquisitions are hot, high-quality companies have become scarce resources

Behind the rapid growth in box office to 44.069 billion yuan in 2015, the capital market has once again attracted attention to the film and television industry, resulting in 76 mergers and acquisitions involving the film and television field in 2015. While a large amount of capital is continuously injected into the film and television industry and expanding the scale of the industry, the difficult market bubble is also having a negative impact on the film and television industry.

Original title: The hot market bubble for mergers and acquisitions in the film and television industry is difficult to eliminate

. Behind the rapid growth of box office to 44.069 billion yuan in 2015, the capital market has once again attracted attention to the film and television industry, resulting in 76 mergers and acquisitions involving the film and television field in 2015. While a large amount of capital is continuously injected into the film and television industry and expanding the scale of the industry, the difficult market bubble is also having a negative impact on the film and television industry.

Since 2014, the capital market has begun to set off a wave of mergers and acquisitions in the film and television industry, but last year, this craze increased rather than decreasing. According to public data, there were 137 mergers and acquisitions in the cultural media industry in the A-share market in 2015, involving approximately 230 billion yuan in capital, of which 76 were related to film and television, equivalent to one film and television merger incident every week, involving a total of 200 billion yuan in capital, including many cross-border acquisitions involving real estate, tourism and other capital operations. However, in 2013, there were only 7 mergers and acquisitions involving the film and television industry in A-shares, compared with 61 mergers and acquisitions in 2014.

According to Huang Qunfei, executive deputy general manager of Huaxia Film Distribution Co., Ltd., capital is profit-seeking."At this stage, the economic downward pressure is great, but the film market is in a state of rapid development, and the box office scale continues to expand. While other industries, especially traditional industries, are shrinking, they have focused on the film and television industry in order to improve their own profits. At the same time, film and television companies have also chosen to acquire small film and television companies in order to further expand their scale and occupy market say."

Through observation, we can find that not all film and television mergers and acquisitions can be successfully completed or expected returns can be achieved. For example, *ST Shenke issued an announcement in May 2015, announcing the termination of the reorganization of Hairun Film and Television. Among them, *ST Shenke stated that the reason was that Hairun Film and Television could not complete the performance. It is unknown when it will be completed. In order to ensure the interests of shareholders of the listed company, the termination can only be announced. In addition, Kangqiang Electronics also announced the termination of the acquisition of Yongle Film and Television in November 2015. The reason for the termination was that the counterparty believed that an objective event had occurred that neither party could predict or avoid.

Liu Gang, general manager of Shenzhen Venture Capital's North China Region, said that film and television investment has certain risks. Not every film and television work can be successful. For cross-border capital, it is like a mountain, making it more likely to fail due to lack of experience. After continued hot mergers and acquisitions, there are fewer and fewer high-quality target companies, becoming scarce resources, further increasing investment risks.

Although there are not a few cases of failed mergers and acquisitions, due to the continued rise in box office and the emergence of films that break box office records, some investors only pay attention to a few successful film and television works, ignore most film and television works that have not received expected returns, and pursue interests. Capital continues to inject capital, and this irrational factor also creates a market bubble.

"Due to the injection of a large amount of capital, the film and television industry is currently not short of funds, especially high-quality projects. However, while the crazy inflow of capital creates a market bubble, it will also have a certain negative impact on the development of the industry due to investors 'ideas of making quick money. As the market gradually stabilizes in the future, investors will gradually view the film and television industry objectively, thus making investment gradually more rational,"Liu Gang said.

Editor: vian