Dalian Wanda to buy Legendary Entertainment stake for $3.5bn
- 12 January 2016
- From the section Business
China's Dalian Wanda Group is to buy a controlling stake in Hollywood film studio Legendary Entertainment in a deal valued at $3.5bn (£2.4bn).
Legendary is the maker of blockbuster hits such as Jurassic World, the Dark Knight Batman trilogy and Godzilla.
Wanda is the world's biggest movie theatre operator with a majority stake in the US chain AMC.
The rapidly growing group is led by China's richest man, Wang Jianlin.
Mr Wang has been looking to buy a Hollywood studio for several years and was reported to be in talks with DreamWorks Animation last year, but a deal was not announced.
The announcement, made at a press conference by both firms in Beijing, comes after a week of rumours about a possible deal.
Legendary Entertainment chairman and chief executive Thomas Tull, who also started the company, will remain as the head of the studio.
Stephen Evans, BBC News, Beijing - 'Not expected to defy censors'
Buying Legendary Entertainment puts Wanda on the road to becoming a global media company and one of the world's biggest players in movie production. It already owns China's biggest chain of cinemas as well as cinemas in the United States.
But will it compromise artistic standards by leading to films which have to please too many people, including Chinese censors?
Wanda's founder and chairman, Wang Jianlin, told the BBC that Hollywood films would have to adapt to the Chinese market if they wanted to succeed there: "I think this is very normal because US companies want to grab a share in the Chinese high-growth market. They should do something to cater to Chinese audiences' interests — if they don't, there might be trouble".
The new combined operation is making a movie about the Great Wall, featuring Matt Damon with Chinese director, Zhang Yimou. It's due for release this year. Legendary described it as "the story of an elite force making a last stand for humanity on the world's most iconic structure".
But the enlarged media company is expected to steer clear of any movies that might fall foul of the strict censorship of political matters in China.
Read more: Hollywood studio buy-up begs questions
Wanda described the deal as "China's largest cross-border cultural acquisition to date". It is aimed at increasing ties between Hollywood and the world's fastest growing movie market, China.
The Chinese conglomerate said that Legendary's films have grossed over $12bn globally.
Mr Wang said he plans to pair the Hollywood studio with its in-house film production unit and make a stock market listing. A timeline for the launch an initial public offering (IPO) was not given.
What else does Dalian Wanda own ?
- Founded in 1988, Wanda is probably best known as China's biggest commercial real estate firm
- Domestically, the group already has some 125 Wanda Plazas, 100 department stores and 80 hotels - with scores more under construction
- Wanda's expanding entertainment and tourism sector spans movie cinemas, theme parks and film production
- The Wanda Xishuangbanna International Resort - which is more like an entire town - has a hospital, schools, luxury hotels, a shopping district and a theme park
- Internationally, the Chinese giant has been on a buying spree - with a focus on investing in hotels and big foreign brands - including US cinema chain AMC and luxury British yachtmaker Sunseeker
- Wanda was the first Chinese company to invest in a top European football club - Spain's Atletico Madrid
Wanda had released its earnings report a day earlier and said that its revenue rose 19% in 2015 from a year ago on a surge of sales in its leisure and financial businesses.