China continues its push to capture Hollywood with a new $1 billion deal with Paramount Pictures. Two Chinese firms Huahua Media and Shanghai Film Group have agreed to finance nearly a quarter of Paramount films over the next three years.

Under the terms of the deal, SFG and Huahua Media will have the option to extend the deal for the fourth year.

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Hollywood majors such as Walt Disney, Warner Bros., and Lionsgate have formed significant ties with Chinese firms. In 2016, Chinese conglomerate Dalian Wanda snapped up a controlling stake in Legendary Entertainment for $3.5 billion.

Paramount is owned by Viacom and will get access to the Chinese market with this deal. China has the second-biggest cinema market in the world. "Certainly Paramount would love to produce films (in China), and we think that should be a win for us," Paramount CEO Brad Grey said.

The US studio is currently looking to increase the number of movies that it churns out every year. Grey said that Paramount is aiming to produce 15 to 17 movies a year. Having access to China's huge market is expected to help the company achieve these goals.

This is not the first instance of cooperation between the studio and Chinese companies. Huahua has already worked with Paramount on several projects including Star Trek Beyond and Transformers: the Age of Extinction. Shanghai Film Group had held a stake in Jack Reacher: Never Go Back.

TagsParamount Films, Huahua Media, Shanghai Film Group