Dalian Wanda Group, the Chinese conglomerate controlled by billionaire Wang Jianlin 王健林, announced on June 10 that it would sell 76 hotels and 13 cultural and tourism projects, including theme parks, for $9.3 billion to Sunac, a Tianjin-based property developer. The move was interpreted by many in the business world as an embarrassing failure to make good on Wang’s earlier vow to crush Disney’s theme park operations in China.
In an interview (in Chinese) with Caixin, Wang explained the calculation behind the decision, saying that the sale would significantly ease Wanda’s debt pile and help the company shift toward “asset-lite.” Paper.cn says (in Chinese) that Wanda has been retreating from the Chinese market since 2015, pulling out from capital investments and focusing on services such as property design and management. At the same time, Wanda has been acquiring overseas companies — such as America’s second-largest theater chain, AMC Entertainment — at an alarming speed. Despite a few setbacks, Wanda owns a variety of foreign assets of about $36.1 billion.
Although Wanda’s aggressive expansion plans are reported to be under increased scrutiny by the central government, many internet users in China are suspicious of Wang’s motives and are unhappy about the privileges enjoyed by the rich. Many people are speculating that Wang must have heard some rumors about future policies that might work to his disadvantage. “Apparently, he is trying to abscond with the money. There is no Great Firewall for capital!” one commenter wrote (in Chinese). Others complain that whereas ordinary people can only convert $50,000 worth of yuan into foreign currency per year, there seems to be no restrictions at all on Wanda taking its money out of the country.
Still others are concerned that it is the have-nots in China that will ultimately suffer from the consequences of Wanda’s heavy debt load. One commenter wrote, “Wanda was using loans to create property bubbles for years. Now the market is about to collapse. Wang will be perfectly fine, but we are going to pay for his irrational decisions.”
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