Chinese video sharing website Bilibili has entered into a definitive subscription agreement with Hong Kong entertainment and film-focused media company Huanxi Media Group.

NASDAQ Stock Exchange-listed Bilibili received legal advice on the equity investment into Huanxi from a Hong Kong-based Latham & Watkins team.

Under the terms of the agreement, Bilibili will subscribe to over 346 million of Huanxi Media’s freshly issued ordinary shares for a total consideration price of approximately HKD 513 million, equal to about USD 66 million.

The transaction will close once the listing committee of the Hong Kong Stock Exchange has approved the listing and granted its permission to deal in the subscription shares.

Following the transaction’s completion, Bilibili will be the beneficial owner of approximately 9.90% of the total enlarged share capital of Huanzi Media.

Two companies belonging to Bilibili have entered into a business cooperation agreement with one of Huanxi Media’s wholly owned subsidiaries. The agreement will be given effect before the subscription shares have been subscribed to.

Under the business cooperation agreement, Huanxi Media will be granted exclusive broadcasting rights, excluding those related to Huanxi’s own online platform, to Huanxi’s existing and future film and television drama series releases.

After the transactions have closed, both companies will work together to target partnership opportunities in the Chinese online entertainment space, including in the areas of film and television.

“This strategic partnership will bring significant benefits to both companies. We will integrate our resources to provide our audiences with an increasing number of high-quality content,” said Huanxi’s CEO, Steven Xiang, in a statement.

Cathy Yeung, global vice chair of Latham & Watkins’ capital markets group, chair of the Greater China practice, and advisory team leader, described the transaction as a “dynamic strategic partnership between two leading China-based companies”, which is significant in a “fast-growing… entertainment sector”.

Explaining the rationale for the investment, Bilibili’s vice chairwoman of the board and chief operation officer, Carly Lee, said in a separate statement that Bilibili is “actively broadening and diversifying [its] content to appeal to a wider audience”, adding that “the key investments we are making now support our future growth”.

“We believe Huanxi’s library of high-quality content, as well as their relationships with China’s top directors, align with our strategy to continuously bring in rich new content, and open new opportunities to drive more and diverse demographics,” Lee continued.

In June, Greentown Service Group, a publicly listed residential property management company headquartered in China and listed on the Hong Kong Stock Exchange, made a placing raising net proceeds of HKD 2.7 billion.