Animated motion pictures producer and distributor Imagi International said it would acquire Toon Express Group, the manager and owner of trademarks and character copyrights of popular Chinese animation series Pleasant Goat and Big Big Wolf for up to HK$1.05 billion.
Imagi's chairman Francis Leung Pak-to said the acquisition would help it tap into the fast-growing animation business on the mainland.
China's animated cartoon industry has overtaken Japan's in terms of output running time. Foreign cartoons are not allowed to broadcast between 5pm and 8pm.
Pleasant Goat and Big Big Wolf is the most successful piece of Chinese animation in recent years. Created in 2005, it is broadcast over 75 municipal satellite and cable television networks. Last year reports that the beloved clever goats and their rival wolf would be sold to Disney triggered an outpouring of nationalistic fury on the internet. The animation creator had to put out a statement saying the reports were incorrect.
Imagi will settle the initial consideration of HK$814 million through a cash payment of HK$330 million and the issuance of 1.38 million shares at 35 HK cents apiece. Imagi last traded on Friday at 39.5 HK cents.
Imagi has entered into an agreement with 10 investors for the subscription of 1.28 million new shares at 28 HK cents each, raising HK$360 million to fund the cash payment of the initial consideration.