Shaw Brothers has agreed to sell its entire film library to Malaysian tycoon T. Ananda Krishnan for $600 million.
Under the agreement, Shaw would sell its huge archive of original films and their copyright to East Asia Filmed Entertainment, controlled by Malaysia's Usaha Tegas, for $480 million.
The deal also includes the $120 million cost to remaster original film negatives and soundtracks into a digital format.
Shaw would also receive an option to acquire one-third of the shares, in case East Asia will be indirectly listed before the end of December 2002.
If the listing plan does not materialise, Shaw's associate company TVB will acquire 10 per cent of the new shares in the film library.
Shaw, which until the 1970s was one of Hong Kong's biggest film producers, now makes only a handful of movies each year, leasing its studio to TVB for television programme production.
After the sale, the principal activities of Shaw will be investment holding, and investments in the media and entertainment industries.