×
You will be redirected back to your article in seconds

Wanda Faces Hurdles in Closing Dick Clark Prods. Deal (EXCLUSIVE)

The Dalian Wanda Group announced its eye-popping $1 billion deal to buy Dick Clark Prods. back on Nov. 4. But the transaction is taking longer than expected to close, stirring chatter in the media finance community as political conditions on both sides of the Pacific appear to pose hurdles for Chinese investment in Hollywood.

Sources close to the situation still expect Wanda to close the acquisition sometime in February, and say that the only speed bump has been that some details are still being worked out. With the Chinese New Year holiday beginning on Saturday, work is expected to be halted for at least the next week.

One person said that work on the deal also came to a standstill a few weeks ago, amid concerns that the nationalistic focus of the new Trump administration might mean greater scrutiny to big investments in the U.S. by Wanda, Alibaba and the new breed of Sino mega conglomerates. The Dick Clark Prods. transaction was only the most recent mega-acquisition for Wanda, which also bought Legendary Entertainment for $3.5 billion last year and AMC Theaters for $2.6 billion in 2012. Wanda’s buying spree has caught the attention of members of both parties in Congress, who worry that they could mark a strategic extension of Chinese “soft power.”

Chinese overseas investment jumped by 50% in 2016, according to an estimate compiled by the American Enterprise Institute. The U.S. was by far the largest recipient with a record-setting $50 billion of Chinese investment.

However, China has been taking steps to curtail overseas investment. AEI projects that the number of Chinese deals will decline in 2017. China’s efforts to stem capital flight could pose a complicating factor as Wanda seeks to close the Dick Clark Productions deal. In December, Chinese metals company Xinke abruptly and mysteriously dropped its deal to buy a majority stake in Voltage Pictures for $345 million, opting to buy a Hong Kong entertainment company instead. Voltage is now suing to recover a $4 million deposit.

In Hollywood, observers are still astounded at the $1 billion price tag for DCP. Guggenheim Partners bought the company in 2012 for $370 million, and at the time many considered that price to be inflated. Dick Clark Productions in late 2015 changed hands again when investor Todd Boehly left Guggenheim, taking DCP, the Hollywood Reporter, Billboard and other assets with him to the new Eldridge Industries banner.

Dick Clark Prods.’ biggest franchises are its award shows, notable the Golden Globes, the Academy of Country Music Awards, and the American Music Awards. It’s also the home of ABC’s annual “Dick Clark’s New Year’s Rockin’ Eve” specials, which made headlines this year for problems during Mariah Carey’s live performance.

With Dick Clark Prods., sources said the company is moving forward as if the Wanda acquisition is a done deal. There’s excitement at the prospect of being part of a larger entity with ample resources at its disposal. But getting the deal to the finish line is proving more complicated in the current political climate than both sides expected.

Wanda and Eldridge Industries each declined to comment.

More Biz

  • Colin Kaepernick Kneel

    Colin Kaepernick, Eric Reid Reach Settlement With NFL

    Colin Kaepernick and Eric Reid, two football players who alleged the National Football League colluded to oust them from the game after they started kneeling in protest of racial inequality during the playing of the national anthem, have reached a settlement in the matter, according to a statement from the sports organization and lawyers representing [...]

  • R. Kelly

    R. Kelly Could Be in ‘Big Trouble’ Over Alleged New Sex Tape, Attorney Says

    Strong allegations of sexual misconduct have followed R. Kelly for 25 years, but the singer has always managed to slip free. Yet reports that a videotape of him sexually assaulting an underage girl, combined with the outcry surrounding the Lifetime documentary “Surviving R. Kelly,” means that public sentiment, at the very least, is definitely not [...]

  • Christian Bale as Dick Cheney in

    New Media Residuals and Feature Films Contribute to Spike in Writers' Pay

    The outlook for members of the Writers Guild of America has brightened — even amid pervasive uncertainty in the entertainment industry. According to the most recent report to WGA West members, earnings surged 2.8% to $1.41 billion in 2017, thanks mostly to gains in feature films and new-media residuals. Total covered earnings for WGA West [...]

  • Joe Dante Gremlins

    Hollywood Execs Seek Licensing Deals at the New York Toy Fair

    On Feb. 16 more than 30,000 studio executives, buyers and toy company reps will gather in Manhattan for the annual Toy Fair New York, all vying for market share and trying to snag the latest hot trend in a fast-changing industry. Those working the film side of the business will focus much of their attention [...]

  • Lady Gaga Bradley Cooper A Star

    Universal Music Group Fuels 11.3% Rise in Vivendi's 2018 Revenues

    Vivendi’s revenues were up 11.3% to €13.93 billion ($15.7 billion) in 2018, powered by Universal Music Group, which delivered such hits as the “A Star Is Born” soundtrack and Drake’s new album. UMG’s revenues climbed by 10% to €6 billion ($6.8 billion) compared to 2017. On top of the “A Star Is Born” soundtrack, the [...]

  • The Blacklist 100th Episode

    'The Blacklist' EP Sues for Wrongful Termination

    A former executive producer of the NBC show “The Blacklist” has filed suit against Sony, alleging he was fired after being wrongfully blamed for a workplace scuffle. Michael Watkins is a veteran TV director and cinematographer. He was an executive producer for several seasons of “The Blacklist,” the NBC crime show starring James Spader. According [...]

  • TV set livingroom

    Studios Sue Omniverse in TV Streaming Crackdown

    The major studios filed a copyright infringement suit against Omniverse One World Television on Thursday, as they continue to crack down on illicit streaming services. Omniverse provides packages of TV channels to various streaming providers, including SkyStream TV, Flixon TV, and HD Homerun. Jason DeMeo, the head of the company, asserted in an interview with [...]

More From Our Brands

Access exclusive content