Wanda Group's $8.846 billion layout overseas global entertainment company ambitions show

Wanda's acquisition of Legendary Pictures has turned its attention to upstream film and television production and further extended the overseas asset chain. At the signing ceremony, Wang Jianlin, chairman of Wanda Group, said that mergers and acquisitions would increase Wanda's voice in the global film industry. "The film market is global, and Wanda must have a say in the world."

Original title: Wanda's US$3.5 billion acquisition of Legendary Pictures Wang Jianlin said he valued its IP.

January 12 news, at the beginning of 2016, the capital market was in two ice and fire. Today, Wanda held a media conference to announce that Wanda Group has acquired Legendary Pictures, a US independent film production company, for US$3.5 billion (approximately RMB 23 billion). Wanda said that this is the largest cultural acquisition overseas by a China company.

Wanda's acquisition of Legendary Pictures has turned its attention to upstream film and television production and further extended the overseas asset chain. At the signing ceremony, Wang Jianlin, chairman of Wanda Group, said why buy Legendary Pictures? First of all, Legendary owns a lot of IP intellectual property rights. The value of mergers and acquisitions does not lie in the film itself. Wanda is committed to the entire entertainment and tourism industry this year. For Wanda film production, theaters and distribution industry chains, mergers and acquisitions are a synergistic effect that increases Wanda. Second, mergers and acquisitions will increase Wanda's voice in the global film industry. "The film market is global, and Wanda must have a say in the world." At the same time, it also revealed that it may also acquire international entertainment companies in the near future.

At the same time, Wang Jianlin said that mergers and acquisitions increase the comparative effect of the two parties. Wanda and Legendary Pictures both have huge theaters and distribution in China and the United States. "Legend will increase its financial report significantly through this acquisition." When talking about the benefits of acquiring Legendary Pictures, Wang Jianlin revealed that Wanda will launch a capitalization action in the production and distribution industry this year. The addition of Legend will undoubtedly add highlights. At the same time, it said that the merger and acquisition of Legend is just right. This year, Legend will have two blockbusters released, and both parties can also learn closer from film production and distribution experience. Thomas, CEO of Legendary Pictures, also said that he would work with Wanda to build Legendary Pictures into a new international entertainment company.

Legendary Pictures that is difficult to tame

However, the question arises. Can Legendary Pictures, which was previously considered difficult to tame, be subdued by Wanda?

Unlike the six major Hollywood film companies, Legendary Pictures was founded with private equity funds. In 2004, Legendary owner Thomas. Tour used $500 million raised from private equity firms to form Legendary Entertainment, the parent company of Legendary Pictures. It is also reportedly one of the first companies of its kind to rival major film production companies backed by private Wall Street shareholders and hedge fund investors.

From the first day of its establishment, Legendary Pictures has not been a pure film company, but a financial company with films as its main investment project. In 2010, legendary boss Thomas. Tour worked with Fidelity Investment Group and Fort Peak Investment Group to jointly buy all shares of other original shareholders of Legendary Pictures. Strong Thomas. Tour, who also has his own unique eye in choosing films, has to ask two questions before deciding to shoot a film: Is the story great? How to market? In his view, the film-making process depends on creativity and rational investment.

Legendary Pictures has also tested the waters of China Pictures before. In 2011, Legend Entertainment and Huayi Brothers reached an agreement to jointly establish a film and television production company, Legend Oriental, to produce films and other content for a global audience. At that time, Legendary Oriental was headquartered in Hong Kong, with Huayi Brothers International holding a 10% stake. It planned to produce one or two films every year for global audiences starting in 2013. The deal marked the official entry of Legendary Entertainment into the China market. Media reported that under the agreement, Huayi Brothers is responsible for the distribution of films produced by Legendary Oriental in China, while Warner Brothers, which has been working with Legendary Pictures, will be responsible for the distribution of films in other parts of the world.

However, since then, until March 2015, the first film invested by Legendary Oriental,"The Great Wall," was filmed under the leadership of Legendary Pictures. The film was jointly produced by Legendary Pictures, Universal Pictures, China Film Company Limited and Le Pictures. In China, it will be jointly distributed by Le Pictures and China Film Company Limited, but Huayi Brothers disappeared. Similarly, in September 2015, Legendary Pictures and Tencent Pictures cooperated to jointly create "World of Warcraft". Both parties stated that they would carry out film IP exploration cooperation together, and Huayi Brothers were not among them. Some media reports said that the cooperation between Huayi Brothers and Legendary Film and Television had aborted as early as 2012.

Let's talk about Wanda when we buy overseas

. Recently, Wanda Group announced its 2015 annual performance report. In 2015, Wanda Group's assets reached 634 billion yuan, a year-on-year increase of 20.9%. Revenue was 290.16 billion yuan, completing 109.3% of the annual plan, a year-on-year increase of 19.1%. According to performance express data, Wanda Culture Group's revenue was 51.28 billion yuan, completing 114% of its annual plan, a year-on-year increase of 45.7%. Wanda cinema (103.29, 2.29, 2.27%) Revenue was 8 billion yuan, a year-on-year increase of 49.9%, of which box office was 6.3 billion yuan, a year-on-year increase of 49.6%; Online box office revenue exceeded 4 billion yuan, a year-on-year increase of more than 240%; The number of members of the "heartthrob" exceeded 50 million, accounting for more than 80% of member consumption; the number of movie-watching people was 151 million, a year-on-year increase of 48.9%; 292 theaters with 2557 screens have been opened.

For the acquisition of International Pictures, this is not Wanda's first time. As early as 2012,Wanda Group had spent US$3.1 billion to acquire a 100% stake in AMC, the second largest theater operator in the United States. At that time, AMC was the second largest theater line in North America. It had a history of 92 years. It had 347 theaters and 5048 screens. It introduced the multi-hall concept for the first time and was a household name in the United States. After the acquisition, Wanda also owns the second-ranked AMC theater line in the world and the first-ranked Wanda theater line in Asia, becoming the world's largest movie theater operating company, accounting for about 10% of the global industry's market share, especially in IMAX and 3D screens. It has an advantage in terms of the number of screens and leads the market.

In 2015, Wanda Cinema, a listed company under Wanda Group, acquired a 100% stake in Hoyts, Australia's second largest cinema company, for 2.246 billion yuan. Hoyts was the second largest cinema operator in Australia. At that time, it owned 40 complex cinemas in Australia and 10 complex cinemas in New Zealand, with up to 420 screens. Hoyts also runs Val, the largest local film screen advertising brand in Australia? Morgan Val Morgan has a market share of more than 95% and owns the largest home video rental service in Australia, with more than 600 movie rental machines in local supermarkets and other places, serving 20 million viewers every year. It is also reported that although Australia has a population of only 20 million, the box office of movies has repeatedly ranked among the top 10 in the global film market, and Wanda's overseas territory has expanded again.

Moreover, in 2014, Wanda won the bid for the project site at 9900 Wilshire Avenue in Beverly Hills, Los Angeles, and plans to invest US$1.2 billion to build a comprehensive landmark project. It will set up a Wanda Los Angeles office to be responsible for cultural investment, integrate Hollywood film and television industry resources, and invest in Hollywood film and television companies or invest in Hollywood's globally distributed film and television works, Wanda's ambition to "become a global entertainment company" is fully demonstrated. Wanda Chairman Wang Jianlin has also publicly stated that its goal is to control 20% of the global cinema market by 2020.

Editor: kong