If China’s Dalian Wanda is going to make a comeback in Hollywood, after weathering its present storms, it will do so without Jack Gao. The polished and high-flying executive this week parted from Wanda, the property to entertainment giant, and from its Hollywood producer subsidiary Legendary Entertainment.
Wanda insiders insist that the group maintains a long-term commitment to Legendary, where Gao had been interim CEO since January, and will be back as a major player in Hollywood. But Wanda’s list of problem issues mean that further overseas expansion is not going to happen in the short or medium term.
The Chinese government, in a series of ever stronger measures over the past year, has punished the companies that have engaged in “irrational” and “exuberant” foreign acquisitions. Putting restrictions on deal-making in the areas of hotels, entertainment and sports, the measures seem specifically tailored to halt Wanda in its tracks. And without that activity, Gao’s role is downsized.
Coming only one day before the Chinese Communist Party’s once every five years National Party Congress, Gao’s exit, looks like a politically astute move. It sends out the message that Wanda is willing to accept its punishment, and cooperate with government in its moves against leveraged acquisitions and the attention-seeking pursuit of foreign growth.
Gao, senior VP of Wanda Cultural Industry Group, saw himself at the intersection of the group’s international business and its diversification away from real estate and shopping malls. With Wanda chairman, Wang Jianlin, eating humble pie and refocusing the group on domestic Chinese matters, that international-cultural liaison role makes less sense.
Still, it is a rapid change of fortunes for a man whose previous employers included Bill Gates and Rupert Murdoch, and for someone who stepped right in – and was visibly comfortable – at the Burbank and Beverly Hills top tables. Gao was recently listed by another film trade publication as among the 50 most important players in Hollywood. He is also a board member at the AFI.
In recent months it has been rumored, though not publicly confirmed, that Gao had been sidelined at Wanda’s multi-billion dollar leisure joint venture outside Paris, at its loss-making Sunseeker yachts business in the U.K., and at Wanda Qingdao, the giant studio and real estate complex on China’s east coast that Leonardo DiCaprio and Nicole Kidman graced exactly four years ago. In July, the Qingdao complex was sold to property developer Sunac as part of Wanda’s enforced debt reduction program. Though Wanda still aims to be the site’s operator.
So the exit door may have been opening for the past several months for Gao. But it has the appearance of haste. In August, Gao was still making personal investments in the shares of AMC, the U.S. cinema circuit that was a pre-Gao purchase, and Wanda’s first overseas movie foray.
John Zeng Maojun, who last month held a meet and greet at the AMC theater in Los Angeles’ Century City, now appears to reign supreme over all Wanda’s movie operations: Chinese cinemas, Chinese production and distribution, exhibition in North America, Europe, and Australia, and at Legendary.
Gao and Mary Parent, the head of production at Legendary, have been running the shop since the exit of Legendary founder Thomas Tull in January and China head Peter Loehr in June, and in May they announced a new production slate. But neither Gao or Zeng managed to finalize the appointment of a CEO, though Zeng is known to have interviewed Jim Gianopulos before he joined Paramount in March. That task will be Zeng’s alone now.
Gao has not publicly speculated on his future. With a PhD in Engineering, and a career path in IT, finance, and entertainment management backgrounds, he has the potential to either return to his own Gao Entertainment investment vehicle for a while. Or, when political conditions ease, he could slot into a high-level U.S.-China role straddling tech and entertainment.
As a consultant-investor-broker Gao had roles in setting up News Corp. as an investor in Chinese film distributor Bona Film Group (and briefly sat on Bona’s board), following News Corp executive roles in greater China. He sat on the board of software firm Autodesk, was an early investor in online ticketing firm WeChat Movies. Less gloriously, Gao was a broker of the ultimately unsuccessful deal between China’s Bison Capital and ICM boss Jeff Berg’s startup Resolution Talent Agency.