Sep. 13, 2012
Stephen Scharf
See more on Stephen ScharfO'Melveny & Myers LLP Los Angeles Corporate Specialty: entertainment financing
Scharf has been working with Chinese and other international companies on financing of their motion pictures and other audio-visual content to take advantage of the entertainment industry's boom there.
China, for instance, has increased the number of non-Chinese movies that can be imported - not only from the United States, but around the world, Scharf said, adding, "Their box office is the fastest growing in the world."
"In the past, China financed on a one-off basis, ... movie by movie," he said. "But, increasingly, Chinese institutions and distribution companies and non-Chinese companies want to co-produce movies in China and are looking to adopt technology developed in the U.S. to finance and share portfolios of movies."
Working in foreign venues like China creates "an enormous challenge," Scharf said, with the different legal structures and government restrictions.
"It's an extraordinary learning opportunity," he said. "It's exciting to bring technology into a whole new area of the world and make it fit with the local customs and legal practices."
China also has been expanding the number and quality of its movie theaters.
"There has been an extraordinary amount of construction of new modern theaters, with comfortable seats, digital projection, and showing movies that people want to see - entertainment, not propaganda," Scharf said.
This is happening not only in the big cities, he added, "but in cities we've never heard of."
As for financing, Scharf said, where there is growth, money will follow.
"Banks are lending money and private equity funds are growing enormously in that area," he said.
However, China does present some obstacles.
"One of the things we're working on is structuring ways to permit non-Chinese investment within the constrains of existing government regulations," Scharf said.
- PAT BRODERICK
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