Warner Bros., Brett Ratner cut deal to create Chinese investment fund

Warner Bros. is partnering with filmmaker Brett Ratner and two Shanghai-based companies to create a fund that will invest in film, television and live entertainment projects targeting Chinese audiences.

The entity, called the Creative Fund, will be capitalized “in excess of $100 million,” according to a person with knowledge of the matter who was not authorized to comment publicly.

For Burbank-based Warner Bros., the deal is seen as a way to cultivate relationships in China’s creative community, this person said.

The studio’s Chinese partners in the pact are CMC Capital Partners, a state-backed private equity firm; and Shanghai Media Group, a media and entertainment conglomerate.

The other partners in the deal with Warner Bros. -- Hollywood’s biggest movie studio -- are Ratner’s RatPac Entertainment and WPP, one of the world’s largest advertising firms.

The pact isn’t Warner Bros.’ first with Ratner, the co-founder and chief executive of RatPac. Last year, another of the “Rush Hour” filmmaker’s ventures, RatPac-Dune Entertainment, struck a four-year co-financing deal with the studio that is valued at about $450 million.

News of the deal comes a day before Warner Bros. is slated to participate in an investors event being hosted in New York by its parent company, Time Warner. At the gathering, Warner Bros. is expected to detail its upcoming film slate, and could discuss impending layoffs.

The company is set to embark on a round of layoffs by early November, and although there is no preordained number of job cuts, the reductions are expected to be “significant,” affecting all divisions of the studio, The Times reported Oct. 7.

Warner Bros. released a handful of duds during the summer, including “Blended” and “Jersey Boys,” and now finds itself in unfamiliar territory: third place in domestic box-office share. The studio has finished No. 1 or No. 2 in nine of the last 10 years.

Warner Bros.’ Creative Fund would target Chinese-language projects and others that appeal to audiences in the world’s most populous country.

In a statement, Warner Bros. Chief Executive Kevin Tsujihara said China “is a market with incredible potential and a wealth of talent.”

“We are very proud to be part of this vibrant creative community,” he said.

CMC Capital Partners’ entertainment investments include a stake in IMAX China that it acquired in April. It has also partnered with DreamWorks Animation to build a large entertainment, dining and shopping development in Shanghai.

Shanghai Media Group operates 15 satellite and cable networks, including Dragon Television.

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