Chinese conglomerate Dalian Wanda has unveiled plans to consolidate its film and entertainment businesses with the aim of boosting production of films, television and games.
In a company notice issued to the Shenzhen Stock Exchange, Wanda Film Holdings, a subsidiary of Dalian Wanda Group, said it plans to acquire a 96.83% stake of Wanda Media from the company’s 21 shareholders at a price of 11.6 billion yuan ($1.77 billion) via cash payment and share issue.
The proposed deal is expected to strengthen and consolidate the group’s business in content production (Wanda Media) rather than focusing just on cinema operations (Wanda Film). Under the plan, production, distribution and exhibition would all come under one banner. But the restructuring does not include U.S.-based companies AMC Entertainment and Legendary Entertainment, which Wanda, headed by chairman Wang Jianlin, acquired in 2016.
Wanda’s entertainment operations have been going through plenty of changes in recent years. Wanda Cinemas was renamed as Wanda Film last year. A 13% stake in Wanda Film was sold to Chinese e-commerce giant Alibaba and a state-backed investment group in February for 7.8 billion yuan ($1.24 billion).
The restructuring plans reflect Wanda’s ambition in film and content production and distribution, following a number of box-office successes. Films by Wanda Media have achieved a total of 41.5 billion yuan ($6.3 billion) at the box office, with “Detective Chinatown 2” (pictured) raking in 3.4 billion yuan ($519 million) earlier this year during the Lunar New Year festive period. Wanda Media is also engaged in television production, which is comparatively less volatile than the film market. Games will be another focus.
In anticipation of the restructuring, Wanda Film has been suspended from trading since July 4, 2017, until further notice.