All the world’s a stage: Wanda Group extends theatre empire for $1.2bn

All the world’s a stage: Wanda Group extends theatre empire for .2bn

China’s biggest developer is diversifying beyond real estate and into…movies

Odeon cinema on London’s Shaftsbury Avenue. Image credit: Ewan Munro (Flickr)

Real estate, a core business of China’s Dalian Wanda Group, may have to share centre stage with filmmaking and distribution.

As the Financial Times writes, China’s wealthiest man Wang Jianlin is taking advantage of the devalued sterling, with his firm Dalian Wanda acquiring British theatre chain Odeon & UCI Cinemas Group through private equity firm Terra Firma Capital Partners for USD1.2 billion.

The deal comes just months after Dalian Wanda took over Legendary Entertainment, the American movie studio behind “Jurassic World” and “The Dark Knight,” for USD3.5 billion.

Now with a portfolio that includes US theatre chain AMC Entertainment Holdings and Australian theatre chain Hoyt Group, acquired in 2012 and 2014, respectively, Dalian Wanda is currently the biggest theatre owner in China. With the Odeon acquisition, the company could be managing 7,600 screens across four continents.

More: Wanda Group sets sight on ‘world’s largest developer’ title

Diversifying into the entertainment business has cushioned Dalian Wanda’s recent setbacks in the real estate sector.

Sales at Dalian Wanda Commercial Properties plunged 17.3 percent in the first half of 2016 from the same period last year, Mingtiandi reported. Rental revenues only made a relatively small CNY8.48 billion (USD1.3 billion).

For perspective, revenues for Wanda Cinema Line Corp over the same period reached CNY29 billion (USD4.39 billion), while revenues for Wanda Film Holdings topped CNY19 billion (USD2.89 billion). All in all, entertainment revenues for the company rose 57.1 percent in the first half of 2016.

Dalian Wanda founder Wang Jianlin has vowed to wean his company off real estate margins and reinvent it into a media company with annual revenues of CNY80 billion (USD11.9 billion) by 2020.

Although films would play a role in the company’s reinvention, theme parks would be a key player as well. Wanda Tourism, which operates theme parks across second-tier Chinese markets, saw revenues top CNY6.03 billion (USD913 million) in the first half of 2016.

Source: Property Report