Another US Asset, Legendary Entertainment, Weighs Financial Options
Dalin Wanda Group has sold off most of its holdings in movie theater chain AMC Entertainment, marking a dramatic retreat from Chinese billionaire Wang Jianlin’s bold Hollywood ambitions.
Wanda sold nearly $426.9 million worth in shares of AMC over the last week, reducing its stake in the theater chain to just 0.002%, according to a regulatory filing Friday.
The Chinese investor has held a controlling stake in the exhibition giant since a $2.6 billion deal in 2012 that at the time marked the largest overseas acquisition by a privately held Chinese company. The Beijing-based group began paring its stake in AMC in 2018 and in March this year, it sold 15.6 million shares for $220 million.
Another of Wanda’s entertainment holdings, Legendary Entertainment, the studio behind the Godzilla vs Kong, Pacific Rim and Detective Pikachu films, is exploring its financial options, according to several people familiar with the matter.
The company has held exploratory talks with special purpose acquisition companies (SPACs) about the possibility of going public. The discussions are preliminary, sources say, and may not result in any deal. Insiders insist the studio isn’t in financial distress, and is profitable with plenty of cash on hand.
Still, Legendary CEO Josh Grode is seeking to capitalize on a moment of opportunity after Godzilla set a pandemic global box office record of $422.7 million, while capturing the buzz around another big-budget science fiction epic, Dune, debuts in October. A Legendary spokesperson declined to comment.
Bloomberg previously reported that Legendary had enlisted the investment bank LionTree to hunt for possible deals.
The Wanda Group took control of Legendary in 2016 in a $3.5 billion deal. At the time, Wanda’s chairman, Wang had taken an avid interest in Hollywood, having invested in AMC and negotiated a $1 billion deal to buy Dick Clark Productions, producer of a number of award shows, including the Golden Globes, in a transaction that ultimately unraveled in 2017.
Wanda’s investments in Hollywood were part of a surge of interest from Chinese investors. Billionaire Jack Ma’s Alibaba Group formed a $300 million film fund with partner Wuhu Gopher Asset Management in 2016, and Tencent took a minority stake in Skydance Media, a production company founded by David Ellison, son of software billionaire Larry Ellison. Since then, the glamor faded as China emerged as the world’s largest movie market, surpassing the U.S. in ticket sales.
Wang has been shedding assets as he seeks to reduce Wanda’s debt and turnaround his real estate and entertainment empire. He sold Wanda’s hotel and tourism portfolio for over $9 billion in 2017, then hawked its 17% stake in the Spanish soccer club Atletico Madrid a year later.
Once China’s richest person, Wang’s net worth has fallen from over $31 billion in 2017 to $14.7 billion currently, per Forbes estimates. It’s unclear whether Wang would seek to reduce his stake in Legendary should the company go public.
Forbes staff writer Jennifer Wang contributed to this story