China’s richest man, Wang Jianlin (王健林), has built a US$100 billion business empire founded on shopping malls, but now he has set his eyes on a new trophy — building a global sports conglomerate to match his country’s economic and political might.
News on Friday last week that Wang’s Wanda Group Co (萬達集團) has become a top-level sponsor for soccer’s scandal-tainted governing body FIFA was just the latest show of its founder’s ambitions.
With Chinese growth slowing and its once buoyant property sector now troubled, observers see Wang’s business acumen behind the shift into sports and entertainment.
The move also plays into Chinese government policies for companies to buy up overseas assets, as well as to promote the country’s “soft power” abroad.
“There are a lot of people following football, so there is a big propaganda effect,” Deng Haozhi (鄧浩志), a property analyst at Chinese developer Fineland Group (方圓地產), said of the FIFA sponsorship.
“There is also a political imperative for this,” he told reporters. “Many big property developers are participating in the football industry, which is the new preference and goal for China.”
Chinese President Xi Jinping (習近平), a fan of the sport, is pushing to turn the nation into a soccer power, despite its dismal national team, ranked 96th in the world by FIFA.
Xi has declared his hopes that China will one day host and win a World Cup, prompting a flood of money into its professional teams. Chinese Super League clubs spent a world-beating 331 million euros (US$373 million) on player transfers for the new season.
“It’s a way to get China more influence in FIFA and get China to host the World Cup eventually, but that’s going to be a long way off,” Web site Wild East Football founder Cameron Wilson said.
Wanda shopping malls are a familiar feature of China’s urban landscape, but founder Wang, whose personal fortune is now near US$30 billion, was unknown to the outside world until paying US$2.6 billion for US cinema chain AMC Entertainment Holdings Inc in 2012.
In China’s biggest-ever cultural takeover, Wanda in January signed a US$3.5 billion deal to buy Hollywood studio Legendary Pictures LLC, maker of blockbusters such as Jurassic World and Godzilla.
Wang’s Wanda Sports Holding Co (萬達體育控股) already claims to be the world’s largest sports company and has a goal of reaching annual turnover of US$10 billion.
It already owns Swiss marketing group Infront, a 20 percent stake in Spanish soccer club Atletico Madrid and the organizer of the Ironman extreme endurance contests.
Both Infront and Wanda Sports are headed by Philippe Blatter, nephew of the former FIFA chief Sepp Blatter, who was forced out over a corruption scandal.
The Wanda group considers the “cultural industry” — including sports, film, entertainment and tourism — to be a key driver for the future.
“This sector is gradually emerging as one of Wanda’s core businesses,” its Web site said.
In his own words, Wang sees soccer as a priority, even though Wanda is not directly involved in a Chinese soccer club of its own, after selling the team in its origin city of Dalian years ago.
“The government leaders care about it very much, and the Chinese administration of sports made several appeals, so I came back and am offering support for Chinese football,” Wang wrote in a recent book.
Under the FIFA deal, Wanda is to have sponsorship rights to all FIFA competitions and corporate activities up to and including the 2030 World Cup. Financial terms were not disclosed.
Like other large private companies in China, ties to authorities can be good for business. Wang has confirmed that Xi’s brother-in-law has owned shares in one of the group’s companies.
Wang, the son of a Chinese Red Army captain, was also a soldier before he founded Wanda in the late 1980s, building it up with military discipline.
Previously a local government official in Dalian, Wang transformed a failing state-owned property developer after winning a contract to renovate shanty housing and grew it into Wanda.
He is seeking to make Wanda a “world-class” multinational corporation with assets of US$200 billion, revenue of US$100 billion and net profits of US$10 billion by 2020, according to the company.
“If he can bring a World Cup to China, Wang Jianlin will be a hero,” another online poster said.
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