- Wanda sets its sites on France and the U.K.
- NY- and Shanghai-based Han Capital raises $300M for China film, TV
- China tightens Web control, censors shows, raises hurdles for participation
China’s wealthiest man and his companies were all over the news this week. After Wang Jianlin dropped hints earlier in the week about an upcoming announcement (leading to more speculation), Friday brought the news that his Dalian Wanda Group is leading a partnership to build a $3.3 billion theme park outside of Paris, the conglomerate’s largest European project to date.
Wanda’s EuropaCity development apparently aims to present a head-on challenge to the nearby Disneyland Paris (formerly known as Euro Disney), which has seen its share of struggles over the years. Wang has boasted that Wanda’s planned amusement parks in Guangzhou and Wuxi will beat their respective Disney rivals in Hong Kong and Shanghai in terms of revenue and visitor numbers. However, what should be Wanda’s flagship tourism development, the Oriental Movie Metropolis in Qingdao, touted as a movie studio and theme park project, is still largely centered around traditional real estate development, with apartment buildings, retail space, hotels, and even a high-end hospital. So it remains to be seen how successful EuropaCity can be as a tourism project as opposed to an ordinary property play, given that it will also include hotels, retail developments, and a conference center.
In other Wang Jianlin news, the tycoon rented out part of the British Museum to launch the English version of his book, The Wanda Way, which promotes Wang as a thought leader and proponent of “Chinese enterprise management philosophy.” Wang also spread his gospel in a lecture at Oxford University’s business school, in a British counterpart to his talk at Harvard last fall. At Oxford, Wang said he would consider establishing Wanda’s European headquarters in the U.K., and stated a goal of adding 10,000 jobs in the U.K, including through entertainment projects, which would essentially quadruple its workforce there.
Wanda Group is also seeking to raise $1.5 billion for its film unit, Wanda Pictures, from Chinese investors, which would value the company at $5.3 billion, counting its $3.5 billion acquisition of Legendary Entertainment — a deal that is still technically awaiting completion upon approval from Chinese regulators. Wanda Pictures is planning on listing within the next year, and if it fails to do so, investors would be entitled to have their shares bought by the parent company with 15% interest, according to the offering document.
More Deal News
Han Capital, a New York- and Shanghai-based investment company headed by former Citigroup exec John Liu, has raised $500 million to fund Chinese film and TV projects, including co-productions. It has a set a target of working on 15 films by 2017, with big-budget productions including a $65 million World War II drama and a $35 million TV series. The company plans to use major Chinese facilities such as Wanda Studios in Qingdao.
Three Hollywood studios — Universal, Lionsgate, and MGM — are partnering with Hong Kong-based mobile game developer Fifth Journey to develop games, virtual reality experiences and other interactive entertainment products based on the studios’ intellectual property, as American companies seek to gain a China foothold in these hot sectors. The studios will also get equity stakes in Fifth Journey, though financial terms were not disclosed.
Paramount has announced that it will explore selling a minority stake, and many look to China as a ready, willing, and able source of investment in the Hollywood studio. Wang Jianlin’s name has come up amid the speculation, but Alibaba’s Jack Ma is often considered a more likely suitor.
Crackdown on Online Video Intensifies
No spoiler alerts for the popular gay-themed series “Addiction” (aka “Heroin”) as Chinese censors pulled the series offline with three episodes remaining.
Just days later, the State Administration of Press, Publication, Radio, Film and Television (SAPPRFT) announced that online dramas will now be treated the same way as regular television programs — meaning that they will be subject to the same pre-approval and censorship process. Furthermore, shows that generate too much “heated discussion” on social media and elsewhere will be subject to extra scrutiny from regulators. Read more original coverage from China Film Insider here.
Also censored this week: Both the online streaming and television broadcasts of the Hong Kong Film Awards, as well as the Golden Horse Awards from Taiwan.
Streamlined Theater Regulations
Chinese media report that the State Council is removing some of the red tape for cinema operators, who weren’t exactly slowed down under the existing regulatory framework, as China added about 9,000 screens in 2015 for a total of around 32,000, up 40% from the previous year. Under new regulations, it will no longer be necessary to obtain approvals to demolish, renovate, or install projection facilities, or for existing theaters to be merged into theater chains. Read in Chinese here.
While Wang Jianlin’s Wanda Cinemas often comes to mind as the top cinema chain in China, the lesser known Hongliyu actually has more theaters across the country than Wanda, and has benefited from extensive government subsidies that have helped fuel the cinema building boom in smaller cities. Read in Chinese here.
Le Eco Takes Baidu to Court
The company formerly known as Le TV is suing Internet giant Baidu for unfair competition, alleging that Baidu’s mobile video app is blocking the ads that are packaged with Le’s streaming content and removing references to Le as the source of the content. Le Eco is seeking an end to the practice, plus compensation of RMB 1 million ($153,000).
More Discussion of Ban on Foreign Online Publishing
As highlighted in last week’s roundup, Chinese regulators recently introduced broad new regulations that limit foreign companies and joint ventures from publishing any kind of online content on their own. The new rules, which are slated to take effect on March 10, continue to be a subject of heated discussion and speculation. A couple of takes worth reading come from attorney Scott Livingston and from this ChinaFile Conversation with media industry experts discussing how China’s Internet can thrive if it shuts out the rest of the world.