China Media Capital to become controlling shareholder of ST Huayi with 836 million yuan investment
Editorial responsibility
- No named human review is recorded for this page.
- Source reporting is collected, normalized, translated or condensed automatically when needed.
- Automatically published source-backed update
ST Huayi (formerly Huayi Brothers) announced on September 16 that it has confirmed China Media Capital (CMC) as the industrial investor for its pre-restructuring case and signed a restructuring investment agreement. CMC will acquire approximately 896.2 million newly issued shares at about RMB 0.93 per share, investing roughly RMB 836 million to take a 17% stake and gain control of the company. The restructuring plan involves issuing 2.497 billion new shares, with CMC's shares locked for 36 months. CMC will nominate 4 of 6 non-independent directors and all 3 independent directors. ST Huayi's registered address will remain in Hengdian. Industry insider Zhu Yuqing called the deal a 'multi-win' for the two companies and the film industry, noting CMC's international perspective benefits ST Huayi's future. CMC, which owns assets including TVB and Shaw Brothers, will leverage its resources to improve ST Huayi's profitability and may inject synergistic assets. Huayi Brothers, once valued at over RMB 80 billion, now has a market cap of RMB 5.52 billion after reporting a net loss of RMB 330 million in 2025.
Source report
Huayi Brothers (now ST Huayi) has taken a major step forward in its pre-restructuring process, announcing on the evening of September 16 that it has confirmed China Media Capital (CMC) as the industrial investor and signed the "Restructuring Investment Agreement" along with its supplementary agreement.
Key Terms of the Investment
- Investment Amount: Approximately RMB 836 million
- Share Price: Approximately RMB 0.93 per share
- New Shares Issued: 896.2 million shares
- Post-Restructuring Stake: 17% (making CMC the controlling shareholder)
Industry insiders view this transaction as a "win-win" or even "multi-win" outcome, benefiting both the veteran film company and the broader film and television industry.
Significant Progress in Pre-Restructuring
On September 16, ST Huayi released an announcement confirming CMC as the industrial investor for its pre-restructuring case and confirming the signing of the relevant agreements.
Share Issuance Plan
Under the restructuring investment plan:
- Current total share capital: 2.7745 billion shares
- New shares to be issued: 2.4971 billion shares (9 new shares for every 10 existing shares)
- Post-issuance total share capital: 5.2716 billion shares
- New shares will not be distributed to original shareholders but used entirely for restructuring
Allocation of New Shares
| Investor Type | Shares Acquired | % of Post-Restructuring Capital | Price | Lock-up Period | |---|---|---|---|---| | CMC | ~896 million | ~17% | RMB 0.9333/share | 36 months | | Financial investors (if any) | ~1.128 billion | ~21.4% | No less than 65% of market reference price | 12 months | | Remaining portion | May be used to settle bankruptcy reorganization debts | | | |
Payment Schedule
The investment will be paid in four installments:
- Registration deposit: RMB 50 million (already received by the temporary administrator as of September 16)
- Performance bond: Topped up to 30% of total investment within 5 calendar days after signing
- Second installment (30%): Within 5 calendar days after court approval of restructuring
- Third installment (30%): Within 5 calendar days after creditors' meeting and shareholders' group vote approve the restructuring plan
- Fourth installment (10%): Within 5 calendar days after court approval of the draft restructuring plan
Key Conditions
- Huayi Film's equity structure will remain unchanged. ST Huayi will still hold 100% equity in Huayi Film after restructuring.
- Board composition: 9 members (6 non-independent, 3 independent). CMC will nominate 4 non-independent and 3 independent directors.
- Registered address: Will remain in Hengdian Film & TV City, Dongyang.
CMC + Huayi: A Multi-Win Situation
Huayi Brothers' Legacy
Huayi Brothers, known as "China's First Film and Entertainment Stock," has produced numerous critically and commercially successful films, including:
- Assembly
- If You Are the One
- The Message
- The Eight Hundred
- Ex-Files series
The company listed on the ChiNext board in 2009 with a highly prestigious lineup of celebrity shareholders.
Recent Financial Challenges
- April 28, 2026: Huayi Brothers announced its stock would be subject to other risk warnings, with the stock abbreviation changing to "ST Huayi" effective April 30, 2026.
- 2025 financial results:
- Total operating revenue: RMB 310 million
- Net profit attributable to shareholders: Negative RMB 330 million
Analysts believe the 2025 loss reflects the concentrated manifestation of historical burdens, and that the effective advancement of the pre-restructuring process is more significant than clearing poor performance.
CMC Group's Resources
CMC Group holds a rich portfolio of cultural and entertainment assets, including:
- TVB (Hong Kong)
- Shaw Brothers Pictures
- Daylight Entertainment
- Caixin Media
- CMC Pictures
- Oriental DreamWorks
- UME Cinemas
- CMC Live
Financial position (as of end of 2025):
| Metric | Amount | |---|---| | Consolidated total assets | RMB 21.359 billion | | Net assets | RMB 6.691 billion | | Operating revenue (2025) | RMB 3.178 billion | | Net profit (2025) | RMB 297 million |
Earlier this year, CMC Group injected high-quality film and television assets such as Daylight Entertainment and Shanghai CMC Pictures into Shaw Brothers, integrating investment, development, production, and distribution across films, TV dramas, and variety shows.
Industry Perspectives
"This is not only a win-win for the two companies but also a multi-win for the industry, which is inspiring for the film industry." — Zhu Yuqing
As a comprehensive media and entertainment company headquartered in Shanghai, Beijing, and Hong Kong, CMC's international perspective is seen as beneficial for ST Huayi's future development.
According to ST Huayi's announcement, CMC will leverage its industrial and resource advantages to:
- Enhance ST Huayi's profitability
- Introduce business resources or inject synergistic assets as needed
- Promote ST Huayi's overall development
Market Context
At its peak, Huayi Brothers' market capitalization exceeded RMB 80 billion. It currently stands at just RMB 5.52 billion.
Source: Shanghai Securities News
Source
东方财富网Eastern
Part of this Story
China Media Capital to invest $836M, take control of struggling ST Huayi Brothers