Wang Jianlin of China’s Wanda Group upbeat on AMC deal, expansion
BEIJING — The Chinese tycoon Wang Jianlin proudly pointed to the sweeping abstract painting of the Great Wall hanging in his marble-walled office.
“It cost more than you can imagine,” said the 57-year-old head of Dalian Wanda Group, China’s largest private company.
Already a massive collector of Chinese art, Wang, who counts an executive jet and an 80-foot yacht among his personal prizes, is China’s 11th-richest man and poised to acquire his biggest trophy yet.
Wanda is awaiting U.S. regulatory approval to finalize a $2.6-billion deal to purchase AMC Entertainment Holdings, the second-largest U.S. cinema chain.
The pending sale represents the largest acquisition of a U.S. company by a private Chinese buyer and would give Wanda China’s first beachhead in Hollywood.
Wang already commands a vast commercial empire, which includes shopping plazas, hotels, the largest domestic theater circuit and a fledgling film production division.
“He could become something like a Jack Warner with Chinese characteristics,” said David Wolf, an independent Beijing-based media analyst.
In an interview inside his headquarters 21 floors above an Imax theater in Beijing’s central business district, Wang dismissed skepticism about the AMC deal, said he was eager to do business with the increasing number of American film companies interested in China and addressed nagging rumors that Wanda was under investigation for ties to disgraced government official Bo Xilai.
Seated in a black leather armchair, Wang said through a translator that he had a message for Hollywood, having seen the likes of DreamWorks Animation and Walt Disney Co.'s Marvel Studios strike partnerships in China, where box-office sales grew 30% last year.
“We welcome large-scale studios and filmmakers to work with Wanda,” the entrepreneur said. “We would like to invest in film production, and we’d like to partner with directors, actors and filmmakers from Hollywood. They need to know the Chinese market is growing very fast, and they should come as early as possible.”
Wang said he was also eyeing hotel and retail investments overseas as part of a plan to further globalize his business.
“By year 2020, our major target is twofold,” the admirer of Bill Gates and Steve Jobs said. “The first one is to be top 100 in the world and secondly to be a multinational and to be a world-known company.”
The AMC acquisition would make Wang one of the largest movie exhibitors in the world. But it also raises a host of strategic questions for Wanda, which is buying a company saddled with debt and short of growth prospects in an industry that is decidedly mature.
While both AMC and Wanda are in the business of showing films, Wang and his company got into it through the success of his commercial properties.
“Cinemas in China are more about real estate than the exhibition business,” Wolf said. “You have a lot of square footage in these multipurpose developments, and multiplex cinemas turned out to be a good way of driving foot traffic to retail.”
The same can’t always be said about AMC properties, which are often located separately from major retail developments.
“We’re not expecting high growth like the Chinese market,” Wang said.
But by investing $500 million into renovation — “targeting seats, audio systems and screen systems,” he said, Wang believes he can drive AMC to expand its revenue 10% or more a year.
“I’m a businessman, and the merger and acquisition of AMC is from a business point of view,” Wang said. “Right now, some people may say it’s not worthwhile to buy out AMC. However, we believe through our constant investment and renovation of the theaters we can create more profit.”
Wang, a 17-year army veteran from China’s central Sichuan province, built his empire from scratch in the 1980s in the then-undeveloped port city of Dalian.
It was there that Wang crossed paths with Bo, the former municipal party chief whose ongoing corruption scandal has dominated Chinese politics. Bo is accused of jailing thousands of political opponents. He embarrassed Beijing when his police chief sought political asylum at a U.S. consulate. Bo’s wife is accused of murdering a British businessman.
Wang has been dogged by rumors over possible illicit ties to Bo because of his vast holdings in the former party chief’s former jurisdiction. Wang denied that he or anyone at Wanda was under investigation.
“I know Mr. Bo Xilai. However, we just maintained a working relationship and do not have a private relationship,” Wang said. “We do not bribe, and this is the only enterprise in China that will publicly announce no bribery to government officials.”
A businessman who worked closely with Wang, speaking on the condition of anonymity, said Wang curried favors from Bo but largely steered clear of the flashy lifestyle that so many other entrepreneurs enjoyed in the booming seaside town.
“Wang is smart,” he said. “He paid lots of attention to his business.”
Wang didn’t start building cinemas until 2005, when he formed a short-lived partnership with Warner Bros. Today, Wanda is China’s largest movie exhibitor, with 730 screens. (By comparison, AMC has 5,000.) Retail property accounts for 80% of the company’s revenue, Wang said.
A fan of kung fu flicks and “Avatar,” the most successful movie in China’s history, Wang said he would like nothing more than to boost the number of available films to show on China’s rapidly expanding network of screens.
“Some people say we’re trying to export Chinese films to the United States,” he said. “That does not reflect our real thinking. What Chinese films lack is content and concepts, not [distribution] channels. The U.S., especially Hollywood, is so strong for film production. So if we’re going to produce films, we need to work together.”
Nicole Liu of the Times’ Beijing bureau contributed to this report.
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