Korean cinema giant set to take over Vietnam market

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South Korea's largest cinema operator CJ CGV will pay US$73.6 million to acquire Vietnam's top cinema chain Megastar, according to industry news sources.

Film Business Asia said in a report on Friday that the Korean company is buying a controlling 92 percent stake in Envoy Media Partners, which owns 80 percent of Megastar. The remaining 20 percent is owned by local publisher Phuong Nam Corporation.

The report cited Andrew Kim, a senior official at CJ CGV as saying that the transaction is expected to be completed within the next six to eight weeks. The deal is the first investment by the CJ conglomerate in Vietnam's film industry, following its venture in the local TV production sector. 

Megastar, which opened its first cinema in Hanoi in 2006, now accounts for around 60 percent of the box office in Vietnam.

Another film industry news source, Screen Daily, said CJ CGV saw great potential in Vietnam's film industry, which only has only about 50 cinemas with around 150 screens.

"CJ CGV, whose affiliate CJ Media also has interests in the broadcasting sector, sees Vietnam as an early and strong receptor of Korean Wave pop culture and plans to use the multiplexes as a bridge into Southeast Asia," according to Screen Daily.

Lotte Cinema, South Korea's second largest cinema operator, entered the market in 2008. It now has two sites in Ho Chi Minh City.

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