Wanda Film plans to sell all the remaining shares again, and Wanda's "big blood bag" is about to change hands?

On December 6, Wanda Film announced that Wanda Film Co., Ltd. intends to plan a change of control, and upon the company's application, the company's shares will be temporarily suspended from the opening of the market on December 6, 2023, and will resume trading after the company discloses the relevant announcements through the designated media.

After less than 2 hours, Wanda Film issued an announcement again, and the company received a notice that the company's indirect controlling shareholder, Beijing Wanda Cultural Industry Group Co., Ltd., its wholly-owned subsidiary, Beijing Run Enterprise Management and Development Co., Ltd., and the actual controller of the company, Mr. Wang Jianlin, intend to transfer 51% of the shares of Beijing Wanda Investment Co., Ltd., the company's controlling shareholder, to Shanghai Ruyi Investment Management Co., Ltd. If the above matters are finally implemented, it will lead to a change of control of the company.

Wanda's big blood bag is changing hands?

Since the beginning of this year, when it comes to Wang Jianlin, the two things that appear most frequently in the public eye are "selling assets" and "finding money to save yourself".

In July alone, assets were sold three times.

On July 10, Wanda Investment transferred 180 million shares to Lu Lili, the boss of Oriental Wealth, accounting for 8.26% of the company's total share capital and worth RMB 2.17 billion;

On July 17, it transferred 177 million shares to Shenxian Rongzhi, a person acting in concert, accounting for 8.14% of the company's total share capital and worth RMB 2.335 billion;

On July 23, Wanda Culture, the indirect controlling shareholder of Wanda Film, signed an "Equity Transfer Agreement" with Shanghai Ruyi Film and Television Production Co., Ltd., intending to transfer its 49% stake in Wanda Investment to Shanghai Ruyi for a transfer price of 2.262 billion yuan.

These three asset sales all involved Wanda Film shares, with a total blood return of about 6.8 billion yuan, which can be described as Wanda's "emergency blood package".

After the transfer, Wanda Cultural Industry Group holds 49.8% of Beijing Wanda Investment, Shanghai Ruyi Film and Television holds 49% of the shares, and Wang Jianlin holds 1.2% of the shares. Shanghai Ruyi indirectly holds 9.8% of the total share capital of Wanda Film, and will directly become the second largest shareholder of Wanda Investment. Wanda Culture and its persons acting in concert hold a total of 21.1% of the total share capital of Wanda Film, and the controlling shareholder of Wanda Film is still Wanda Investment, and the actual controller is still Wang Jianlin.

This time, Wanda Film announced that Wanda Film Co., Ltd. intends to sell all the remaining shares again. Wanda Movies really looks like it's going to change hands.

Where is Shanghai Confucianism sacred?

Shanghai Ruyi is a wholly-owned subsidiary of China Ruyi Holdings Limited, a Hong Kong-listed company. It is worth mentioning that the majority shareholder of China Ruyi is Tencent. On July 4, 2023, Tencent Holdings increased its stake in China Ruyi by 500 million shares, increasing its shareholding to 25.45%. In July's equity transfer, some people ridiculed that "Wang Jianlin, who was in trouble, was pulled by Ma Huateng", it seems that Ma Huateng has once again sent charcoal in the snow.

China Ruyi is a streaming media company that actively lays out the streaming media business, focusing on the vertical pure paid subscription membership system. In the past two years, China Ruyi has received the blessing of Tencent in many business lines such as content production, online streaming media, and games. Its subsidiary, Ruyi Film and Television, is an independent production company in the whole industry chain, which has led the production of more than 50 works and reserves hundreds of film and television copyrights. Popular movies such as "Hello, Li Huanying" and "Send You a Little Red Flower" have all participated in the investment, and the representative works of TV series include "The Legend of Miyue", "Langya Bang", "Splendid Stars" and other dazzling achievements. This year, Shanghai Ruyi co-produced "Disappearing Her", which had a box office of nearly 3.5 billion, and also produced "Keep You Safe" and "Warm".

Debt is tight, and listing is imminent

The sale of assets many times points to the fact that Wang Jianlin has been really short of money recently. According to the statistics of "Small Debt Market Watch", there are currently 9 outstanding bonds of Dalian Wanda Commercial Management, with an existing scale of 6.902 billion yuan, of which 1.878 billion yuan will mature within one year, and 3 overseas bonds with an existing scale of 1.3 billion US dollars, the latest of which will mature in July 2024.

As of the end of the third quarter of 2023, Wanda Commercial Management's total assets were 6,115.83 yuan, total liabilities were 303.36 billion yuan, net assets were 308.224 billion yuan, and the asset-liability ratio was 49.6%.

As of the same reporting period, Wanda Commercial Management's non-current liabilities were 193.861 billion yuan, mainly long-term borrowings, and its total long-term interest-bearing liabilities were 124.561 billion yuan. In addition, Wanda Commercial Management also has current liabilities of 109.499 billion yuan, mainly non-current liabilities due within one year, and its total short-term liabilities are 66.209 billion yuan. From the perspective of liquidity, Wanda Commercial Management has 13.269 billion yuan of monetary funds on its books, a further decrease from the end of 2022, which cannot cover short-term debt, and the cash short-term debt ratio is 0.2, and the company has greater short-term debt repayment pressure.

However, more critical is the progress of Wanda Commercial Management's IPO. According to the VAM agreement, if Zhuhai Wanda Commercial Management cannot be listed in December this year, 22 investors can ask Wanda to repurchase a total of 30 billion yuan (some say 38 billion) of equity at a rate of return of 8%, and the time left for Wanda has been less than one month, and the pressure can be imagined.

The industry also generally believes that the transfer of Wanda Film's controlling stake may be related to the short-term hopelessness of Zhuhai Wanda Commercial Management's listing on the Hong Kong stock market and the pressure of VAM repurchase agreements.

In fact, Wang Jianlin knows very well in his heart that in order to successfully save himself, he cannot just rely on selling his assets. Now that some of the benefits after the transfer can only be exchanged for the current survival, Wang Jianlin has to run around looking for money to save himself. On the one hand, it signed a cooperation agreement with a number of local banks, on the other hand, it went to a number of provinces to negotiate cultural tourism projects around March this year. And whether these will bring considerable gains in the short term is difficult to say.

With Wanda's big blood package Wanda movies all packaged and sold, there are not many high-quality assets that can be sold in the future.

Today's Wanda is on the cusp. In November, Credit Suisse withdrew from the sponsor camp of Wanda Commercial Management's IPO, which also cast a shadow on its listing journey. The failure to complete the listing plan in 2023 is almost a foregone conclusion, and coupled with the huge debt to be repaid, the liquidity and credit conditions of Wanda Commercial and Wanda Group will inevitably deteriorate. Wang Jianlin may face the test of life and death again, but whether he can turn the tide like six years ago will take time to give us an answer.

(This article was first published in Titanium Media APP, author|Zhao Chenhan)