Clear Channel, China Enter Events Partnership
Live entertainment producer Clear Channel Entertainment said Monday that it had entered into a joint venture with the Chinese government designed to export concerts and sporting events from the West to China.
The new company, dubbed Gehua Clear Channel Entertainment & Sports Co., will have a 50-year right of first refusal on arranging and promoting live shows and managing various aspects of the business, including artists, ticketing and tour merchandising, the company said.
Clear Channel and the state-owned Beijing Gehua Cultural Development Group, which controls some of China’s largest venues and organizes cultural and sporting events, did not disclose how much cash each would invest in the new venture.
The partners will each own 50% of the venture and will split profit equally, said Ed Cunningham, chief executive of Clear Channel Entertainment China.
The deal comes after three years of negotiations between Clear Channel Entertainment, a subsidiary of San Antonio-based Clear Channel Communications Inc., and Chinese political and cultural leaders, the company said.
The partnership should help cut costs and simplify the logistics for mounting tours in several locations in China, Cunningham said.
“It’s very expensive to go there for one event,†he said. “But if you can do multiple cities ... that was really our goal.â€
What sort of shows and sporting events get booked in the Chinese venues will be up to Chinese officials, who have the best insight on what type of entertainment will work best in their market, Cunningham said.
One staple of U.S. entertainment that Chinese officials have expressed interest in importing: monster trucking.
“It’s done well in Europe,†Cunningham said. “It’s obviously been a success in the United States. It’s never been in China, but there’s a lot of excitement.â€
The joint venture will be headquartered in Beijing, with offices in New York and London.
Clear Channel Communications shares rose 47 cents Monday to $33.86 on the New York Stock Exchange.
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