Dalian Wanda Selling its Theme Parks, Hotels as Disney China Outpaces It

Dalian Wanda Selling its Theme Parks, Hotels as Disney China Outpaces It

Wang Jianlin, the founder of Wanda Group, once said he would create a tourism empire so big it would eclipse Walt Disney Co.

Dalian Wanda Group on Monday said it would sell 91 per cent of 13 tourism projects, as well as 76 hotels in China, to Sunac China for a total of 63.18 billion yuan ($9.3-billion).

In the statement, Sunac disclosed Wanda would provide a three-year loan of 29.6 billion yuan, which is nearly the same amount as the price for the 13 cultural projects, at a three-year benchmark interest rate. "The deal will give Sunac access to land across tier-one to tier-four cities in one go".

The developer has more than doubled in market value this year to HK$65.7 billion ($8.41 billion).

"This (deal) signifies a retreat from Wanda's previous strategy in cultural tourism, and marks a pivot to an asset-light strategy", said Qin Gang, senior researcher at State Information Center, a government-linked think tank.

The CBRC had expressed concerns about the level of debt taken on by some of China's biggest groups, against a background of skyrocketing debt at corporate level.




Wanda's need to cut its debt pile was seen as the main reason for the sale, with owner Wang Jianlin having reportedly said all the proceeds from the sale would be used to pay down the company's liabilities.

Earlier this week, shares of the conglomerate's public cinema line business Wanda Film Holding were suspended from trading on the Shenzhen Stock Exchange, pending "plans to acquire film-related assets".

An unnamed institutional investor launched a selldown worth about $260 million in China Vanke Co Ltd, China's second-largest property developer, IFR reported on Friday, citing a term sheet of the transaction. "Wanda Commercial plans to repay most of the bank loans this year", Mr Wang told Caixin.

Sunac and Wanda are expected to sign an agreement by the end of this month.

Wanda said it can earn more by managing properties than owning them. "Sunac could be seeking more exposure outside of just purely property development, as growth of Chinese new home sales will likely slow in the long-run".

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