In a dramatic twist to Dalian Wanda’s recent offloading of theme parks and hotels, questions swirled Friday over whether the company’s huge new studio complex in Qingdao is included in the $9.2 billion sale, which would make Wanda’s pullback in the entertainment arena even starker.
In a regulatory filing in Hong Kong, developer Sunac China listed the properties it is acquiring from Wanda in the recently announced deal. In Qingdao, aside from other parcels, the list includes, in English, Wanda’s “television industry park.” (In the Chinese-language filing, the words are “film and television park.”)
The Wall Street Journal quoted a Sunac spokeswoman as saying that this referred to Wanda Studios, the massive production facility Wanda is building in seaside Qingdao, including 30 sound stages, half of which are already up and running. “The Great Wall” and “Pacific Rim 2” were shot at the site, which sprawls over 400 acres, and other productions are underway.
However, Wanda has not responded to requests for comment, including from Variety, on the suggestion that Wanda Studios is part of the selloff of theme parks and hotels, which was announced earlier this month. The studio complex is part of Wanda’s $8.2 billion investment in commercial property in Qingdao.
Last weekend, in an interview about the parks-and-hotels deal, Wanda chairman Wang Jianlin told the Chinese financial journal Caixin that the company had “sold what should be sold and maintained what should be saved.” He said that the sale would help his conglomerate in reducing its debt burden and pursuing a new “asset-light” strategy.
If the Qingdao production complex has been offloaded, with Wanda retaining only a 9% stake, it would represent a major blow to Wang’s trumpeted ambitions of challenging Hollywood. Just last month, Wanda Studios executives proudly gave a tour of the facility to China-based representatives of Hollywood studios and declared their goal of hosting five to six Hollywood productions per year.
Since then, Wanda and other aggressively expanding companies have had their wings clipped by the Chinese government, which is cracking down on overseas acquisitions and other business deals that regulators deem imprudent, especially those laden with debt.
Within days of the announced sale of Wanda’s theme parks and 77 of its hotels to Sunac China and R&F Properties, respectively, a document emerged in China apparently showing that the country’s banks have been banned from helping Wanda finance six of its splashiest deals, including its $3.5 billion purchase of Legendary Entertainment last year.
In his comments to Caixin, Wang sounded a chastened note, saying he would concentrate on investing in China, not offshore, because “companies have to follow the trend of the national economic development.”
Vivienne Chow contributed to this report.