Wanda buys Hollywood company for profit not politics
- By Rory Howard
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E-mail China.org.cn, January 8, 2016
One of China's richest men, Wang Jianlin, is set to buy majority shares in Hollywood movie company Legendary Entertainment, with a closure of the deal potentially coming as early as next week, according to a report from Reuters.
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Wang Jianlin [Photo/China.org.cn] |
Wang Jianlin is the entrepreneur behind Dalian Wanda Group, a Chinese company built on real estate that has now diversified into entertainment and tourism industries. The company, and by extension Wang himself, could pay 1-2 billion US dollars to gain a majority share in Legendary Entertainment, the company behind the "Dark Knight' trilogy," "Pacific Rim," and more recently, "Jurassic World."
This is not the first time that Wang has tried to buy into Hollywood. Wang previously held talks to buy stakes in Metro-Goldwyn-Mayer and Lions Gate Entertainment, but talks ended with no result.
Wang's move into Hollywood is seen by some as a way of expanding China's soft power, with many commentators noting Wang's supposed political connections, and President Xi Jinping's desire to promote Chinese traditional culture abroad through the arts.
Wang's purchase of majority shares in one of Hollywood's most successful studios is likely to be for several reasons that are not entirely political.
Current regulation in China protects the Chinese movie market by limiting the amount of foreign movies given a general release to 34 films a year, limiting Hollywood's access to a market where ticket sales grew by almost 50 percent in 2015. Despite these limits, according to a Bloomberg report, Hollywood movies still made up nearly 50 percent of ticket sales in China. On this point, Dalian Wanda Group will profit from its stake in a Hollywood production company.
Dalian Wanda is also the owner of AMC, one of America's largest cinema chains, so the purchase of a large production company will consolidate Wanda's position in the entertainment industry, potentially creating large revenues for the company.
Legendary Entertainment is also likely to benefit from the sale by providing it with access to the growing Chinese entertainment market.
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