Pop Mart and Sony team up for Labubu film to expand viral toy's reach

Labubu's toothy grin will be coming to the big screen after toy maker Pop Mart 9992.HK and Sony Pictures Entertainment announced plans to develop a feature film based on the ugly-cute monster.

The film, announced in a Pop Mart statement on Thursday, marks a major step in Chinese firm Pop Mart's long-anticipated expansion of its best known characters beyond collectible toys and into other entertainment and cultural products.

The move highlights Pop Mart's determination to turn Labubu from a viral sensation into an entertainment franchise with broad international reach. The company underscored that ambition earlier this year when it said London would become its European headquarters.

Paul King, the BAFTA-nominated filmmaker behind "Paddington", "Paddington 2" and "Wonka", is attached to produce and direct the film. He will also co-write the screenplay with Steven Levenson, the award-winning writer best known for "Dear Evan Hansen".

The film is in early development and is planned as a live-action and CGI hybrid, according to the companies.

Pop Mart has said it is drawing on Disney's DIS.N playbook as it looks to turn Labubu's popularity into lasting success. Executives have said there is significant scope to expand Pop Mart characters, such as Labubu, into content, entertainment, theme parks and additional merchandise, much as Disney has done with its best-known intellectual property.

Morningstar analyst Jeff Zhang said the partnership with Sony Pictures was a milestone in Pop Mart's efforts to diversify its revenue streams.

"Given Labubu's global popularity, the movie will likely add to Pop Mart's future licensing income," Zhang said. "However ... we do not expect the news to materially impact Pop Mart's stock valuation."

Labubu's global popularity has helped drive the Hong Kong-listed company's shares up 64% over the past year, lifting Pop Mart's market value above the combined worth of Hasbro HAS.O, Mattel MAT.O and Sanrio 8136.T.

Kasing Lung, the Hong Kong-born artist and writer who was raised in the Netherlands, created Labubu and The Monsters in a series of picture books known as "The Monsters Trilogy" in 2015. Lung will serve as executive producer on the film.

Pop Mart is currently showcasing The Monsters as part of a global tour to mark the characters' 10th anniversary, with the latest stop in Paris.