Chinese Sponsor Wants Out Of ‘Transformers: Age Of Extinction’

In June last year, Chinese real estate developer Beijing Pangu Investment Company signed a sponsorship deal with the producers of Transformers: Age Of Extinction. Under the terms, the group’s flagship Beijing Pangu Plaza hotel would be featured in the film. Now, in an 11th-hour strike, Pangu says it has terminated the contract.

A statement from the company dated June 18, a day before this week’s Hong Kong premiere, has begun circulating in China alleging that its partners, Paramount Pictures, Jia Fu Company, Jia Fu China Co. Ltd. and Beijing Cheng Xin Sheng Shi Sports Culture Development Co. Ltd., “did not perform the terms” of what I hear was a deal worth roughly $1M. Pangu claims the contract was terminated on June 15 and says it is also terminating permission for the use of its image, logo, or views of the building from the inside or out. If already used in the film, “they shall all be deleted,” the company said. The building does indeed feature in the movie, which I caught at CineEurope this week. Could this issue affect the film’s release? I’m told no. A source says, “This is all about product placement, they didn’t feel like they got full promotion and exposure.” But, it has “nothing to do with distribution.”

China Film Group, the state-backed entity that controls distribution in the country, was not named by Pangu. The movie closes the Shanghai Film Festival this weekend and is set for a day-and-date China release on June 27.

A Paramount spokesperson issued this statement to Deadline: “Pangu Plaza has a prominent placement in Transformers 4 and it looks beautiful onscreen. We regret that Pangu is not currently satisfied with certain aspects of our collaboration and are working to resolve its concerns.” Cheng Xin Sheng Shi Sports Culture Development, one of the partners named by Pangu, told state news agency Xinhua that the parties have been actively working to fulfill obligations. The same report noted that Pangu had expected the movie’s world premiere would be held at its Pangu 7 Star Hotel. In its statement, Pangu said it has filed charges over the issue which has led it to “financial and reputation loss.”

Age Of Extinction has had a big China connection from the get-go, and it’s unlikely this dispute could get in the way of what is expected to be a mega-blockbuster there. In April 2013, Paramount entered a cooperation agreement with the state-backed China Movie Channel and U.S./Chinese streaming company Jiaflix that would provide support of the production of the film in China. Director Michael Bay shot partly in Hong Kong, and Chinese actors including Li Bingbing make appearances. The last film in the franchise, Transformers: Dark Of The Moon, made $165M in China in 2011.