Korean film distributor Showbox seeks investors to expand business

[Courtesy of Orion]

Showbox Corp., a major film distributor in South Korea, is seeking new investors as it needs funds to expand business to respond to the changing media environment led by over-the-top (OTT) platforms.

According to sources from the investment bank industry on Tuesday, Orion Holdings Corp., the largest shareholder of Showbox, is reportedly receiving proposals from potential investors. The move follows the breakdown of a 131.7 billion won ($102.1 million) investment deal with Maum Capital Group Inc. last year.

Showbox is a media affiliate of the Orion Group, which focuses on investment in movie production and film distribution. Orion Group has been prioritizing movie distribution and investment since it sold the multiplex chain Megabox in 2007.

The company incurred a 3.2 billion won operating loss last year due to the pandemic but managed to raise 800 million won in profit in the first quarter of this year.

Although movie theaters are gradually recovering after the pandemic, they are still struggling to regain profitability due to increasing competition from OTT platforms like Netflix Inc.

Showbox, for instance, generated more than 80 percent of its annual sales last year from the domestic and international movie investment business.

In response to the evolving media landscape, the company is expanding its investment in TV and OTT series, primarily on webtoon-based productions.

Multiplex chain operators, in the meantime, are also making significant efforts to ensure survival.

CJ CGV Co. is seeking a 570 billion won capital increase to repay debt and secure operating funds. Lotte Cultureworks Co. has recently issued 70 billion won worth of perpetual bonds. MegaboxJoongAng Inc. also issued ultra-short-term commercial papers with a three-month maturity for liquidity.