China draws attention


When you take the kids or nieces and nephews to see Kung Fu Panda 3 in a few years look for the “Made in China” label.

DreamWorks Animation (NYSE: DWA) unveiled an ambitious foray into the world’s most populous nation this week, creating an animation studio and entertainment district that will dramatically enhance the studio’s brand in China.

A consortium of Chinese companies will hold a majority stake in the Oriental DreamWorks joint venture. That will come as welcome news to DreamWorks Animation investors wondering how the studio would bankroll the roughly US$3 billion investment on its own. It won’t. DreamWorks Animation will retain a 45% interest in the Shanghai project.

Unlike Disney (NYSE: DIS) which is building a theme park in Shanghai, this won’t be a gated attraction. Many of the earlier media reports mistakenly categorised the project as a theme park. Plans for the entertainment complex include establishing the world’s largest IMAX (NYSE: IMAX) theatre alongside shops, restaurants, and hotels. The Dream Centre will open in 2016, coinciding with the release of Kung Fu Panda 3.

DreamWorks Animation has already been establishing itself in China. It teamed up withYouku.com (NYSE: YOKU) — the country’s top video website — to offer its computer-rendered flicks as premium streams.

Animation has been a reliable export over the years. Disney knows it, and DreamWorks Animation is finding that out, too.

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A version of this article, written by Rick Aristotle Munarriz, originally appeared on fool.com

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