The LA-based company has gained a gilt-edged foothold in China’s notoriously inaccessible release calendar after investing in the first China-US distributor and striking a strategic alliance with state-run distributor Huaxia Film.

Relativity has acquired a stake in SkyLand Entertainment, which up until now was jointly owned by Asian equity players SAIF Partners and IDG China Media, the China-focused investment arm of Boston-based International Data Group.

Relativity, SAIF and IDG China Media will manage a $100m fund and develop, produce, acquire and distribute Chinese-based material with global appeal through SkyLand in what is believed to be the first China-US distributor.

In the most intriguing development SkyLand will now serve as the Chinese distributor on all Relativity’s films, a roster that includes Immortals, Haywire and Untitled Snow White Project.

Relativity CEO Ryan Kavanaugh unveiled the deal at a press conference on Sunday [14] shortly after Chinese authorities issued a statement announcing a strategic alliance between SkyLand and state-run Huaxia Film to encourage co-production and promotion between China and the US.

This is significant because Relativity’s new ties to the government should enable it to circumvent the annual quota of 20 foreign releases in China.

“China is the fastest-growing film market in the world, with over 6,000 screens and over $1.5bn in box office revenue last year, an increase of over 60% last year alone,” Kavanaugh said. “We’re excited to be entering into this booming market with such great partners in SAIF, IDG and our new strategic partnership with Huaxia.

“Until now, there has been a major void in bridging the two worlds of the American and Chinese film industries,” SAIF managing partner Andy Yan, a large investor in SkyLand and Relativity, said. “After spending significant time learning about Relativity’s business and how they approach the international markets, we couldn’t be more pleased to have entered into what will undoubtedly be a revolutionary shift in the China film business as we know it.”

“We couldn’t be more excited about creating this revolutionary partnership, and simultaneously entering into a strategic partnership with Huaxia, who has successfully distributed such films as Harry Potter, Transformers, Kung-Fu Panda, Fast Five, Prince of Persia: The Sands Of Time, 2012,Alice In Wonderland, Sherlock Holmes and many others in China,” IDG China Media founding general partner and SkyLand co-financier Hugo Shong said.

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