Chinese conglomerate Dalian Wanda Group has bought U.S. film studio Legendary Entertainment for about $3.5B, "turning its chairman into a Hollywood movie mogul as China's richest man steps up a drive to diversify his business empire overseas," according to Zhang & Miller of REUTERS. Wanda Chair Wang Jianlin said he plans to package Legendary, behind hits like "Jurassic World," with existing movie production assets in China and "sell shares in the merged operation" in an IPO. The move makes Wanda "the first Chinese firm to own a major Hollywood studio -- a sign of the country's growing power in the global movie world, industry watchers said." The exec "gave no further details on the IPO plan," but said he was acquiring Legendary Entertainment for "both intellectual property reasons and the studio's movies." The deal is Wanda's biggest overseas acquisition ever and "comes as Wang accelerates a drive to diversify a giant" with '15 revenue of $44B away from its core, "but slowing domestic property operations." With deals to buy into everything from financial services to La Liga club Atlético Madrid, Wanda said on Monday that revenue rose 19% last year. Under the deal announced on Tuesday, Wanda said it will buy an "unspecified majority stake in Legendary." As part of the transaction, Legendary Founder & CEO Thomas Tull "will continue to head up the movie maker" (REUTERS, 1/12). In L.A., Patrick Brzeski wrote under the deal, Wanda is acquiring 100% of the equity in Legendary and "will then reincorporate the studio according to Chinese and U.S. tax structures." Tull will "remain in charge," with a "pay incentive tied to the studio's performance." Legendary's COO & General Counsel Marty Willhite described the deal as an "unusually complicated transaction." It is expected to close in the first quarter of this year. Tull said in a statement, "This has never happened before. There's no road map for this, we're putting it together as we go" (HOLLYWOOD REPORTER, 1/11). BLOOMBERG reported Wang said in Tuesday’s briefing that he is looking to "buy cinema assets in Europe but is waiting for the right time because prices are too high." He also hinted at "bigger deals to come." Wang: "Maybe in the not too distant future, we’ll hold an even bigger ceremony. Maybe we'd be buying some big entertainment company, or entertainment group. Such things can certainly happen" (BLOOMBERG, 1/11).
