(Yicai Global) July 28 -- Hong Kong Television Broadcasts Ltd. [HK:00511] (TVB) and well-known US Hollywood movie and television production company Imagine Entertainment LLC have set up a joint venture to co-produce television drama programs.

Each will hold a 50 percent stake, with TVB expected to invest USD100 million in this co-production company and own distribution rights in mainland China, Hong Kong, Macao and Taiwan for programs the company produces, TVB announced yesterday.

The cooperation is led and facilitated by Chinese Culture Group Co., an important investor in and long-term strategic partner of both Imagine Entertainment and Young Lion Holding Ltd. -- TVB's largest shareholder, Yicai Global learned from Chinese Culture Group.

TVB suffered an annual revenue drop of 5 percent last year and net profit attributable to shareholders was down 62 percent annually, insiders noted. They thus see cooperation with Imagine Entertainment as a big step forward for TVB's efforts to upgrade its movie and television content.

TVB is hoping to increase its presence in such markets as mainland China, Hong Kong, Macao and Taiwan on the strength of Imagine Entertainment's experience and skills in movie and television drama production, insiders said.

Imagine Entertainment is an independent movie and television production company co-founded by leading Hollywood film producers Ron Howard and Brian Grazer. Its most well-known works include A Beautiful Mind, 8 Mile, Apollo 13, American Gangster, etc.