Fri, Aug 11, 2017 - Page 10 News List

Wanda Hotel shares soar on asset acquisition deal


Shares in Wanda Hotel Development Co Ltd (萬達酒店發展), a Hong Kong-listed arm of troubled Chinese conglomerate Dalian Wanda Group Co (大連萬達集團), yesterday soared after it announced plans to buy more than US$1 billion in assets from firms controlled by group chairman Wang Jianlin (王健林).

The major restructuring plan would see Wanda Hotel Development acquire Wanda Culture Travel Innovation Group Co Ltd (萬達文化旅遊創意集團) — which is focused on theme parks — for 6.3 billion yuan (US$945.5 million), and Wanda Hotel Management Co Ltd (萬達酒店管理) for 750 million yuan.

The group has diversified rapidly in recent years from commercial property into entertainment, theme parks, sports and other sectors, and is now reportedly facing difficulty paying off debts run up in the wake of the series of massive, high-profile foreign acquisitions.

Wanda Hotel stock was yesterday morning up more than 20 percent at HK$1.41 following the restructuring announcement.

The moves are the latest in a wider shake-up of Dalian Wanda Group, which is under scrutiny by Chinese authorities.

Dalian Wanda last month announced it was selling off 76 hotels and nearly of all its holdings in 13 other tourism-related projects to developer Sunac China Holdings Ltd (融創中國控股) for US$9.3 billion in what Bloomberg News said was China’s largest-ever property deal.

It was last month reported that authorities planned to squeeze the conglomerate by cutting off new loans and regulatory approvals for deals, punishment for breaching restrictions on overseas investments.

The regulatory retaliation marks a major setback for the company, which was among the most aggressive players in a flood of acquisitions around the world by Chinese companies.

A spokesperson for Beijing-based Dalian Wanda yesterday said that as part of the restructuring, Wanda Hotel would also dispose of its interests in four overseas property projects to Dalian Wanda Commercial Properties Co (大連萬達商業地產).

“Wanda Hotel Development will become a strategic platform as Wanda Group’s Hong Kong-listed company focusing on theme park and hotel operation and management,” the group said in a statement.

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