Wanda Hotel shares soar on acquisition deal

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BEIJING: Shares in Wanda Hotel, a Hong Kong-listed arm of troubled Chinese conglomerate Dalian Wanda, soared Thursday after it announced plans to buy more than $1 billion in assets from firms controlled by group chairman Wang Jianlin.

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The major restructuring plan will see Wanda Hotel Development acquire Wanda Travel — which is focused on theme parks — for 6.3 billion yuan ($940 million), and Wanda Hotel Management 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 up more than 20 percent Thursday morning at HKD 1.41 (18 cents) following the restructuring announcement.

The moves are the latest in a wider shake-up of Wang’s Dalian Wanda Group now under scrutiny by Chinese authorities.

Last month, Dalian Wanda announced it was selling off 76 hotels and nearly of all its holdings in 13 other tourism-related projects to developer Sunac China Holdings for $9.3 billion in what Bloomberg News said was China’s largest-ever property deal.

It was reported in July authorities plan to squeeze the conglomerate by cutting off new loans and regulatory approvals for deals, in a punishment for breaching restrictions on overseas investments.

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

A spokesperson for Beijing-based Dalian Wanda Group said Thursday as part of the restructuring, Wanda Hotel would also dispose of its interests in four overseas property projects to Dalian Wanda Commercial.

“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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