After a few days of gambling, Wang Jianlin and Wanda's biggest crisis alert was temporarily lifted.
On December 12, 2023, PAG and Dalian Wanda Commercial Management Group jointly announced the signing of a new investment agreement. PAG will work with other investors to reinvest in Zhuhai Wanda Commercial Management after redemption by Dalian Wanda Commercial Management Group at the end of its 2021 redemption period. In August 2021, the existing investors invested approximately RMB38 billion in Zhuhai Wanda Commercial Management, of which PAG invested approximately US$2.8 billion (approximately RMB18 billion), and the existing investors had the right of redemption at maturity in the original investment arrangement.
This means that before the deadline for Zhuhai Wanda Commercial Management's listing in Hong Kong approaches, the VAM pressure on Wanda's listing has been eliminated.
According to the information disclosed in the previous prospectus, Zhuhai Wanda Commercial Management's institutional investors include 22 companies, including Zheng Yutong's family, Country Garden, CITIC Capital, Ant, Tencent, and PAG Investment Group, and these investors invested about 38 billion yuan in Zhuhai Wanda Commercial Management in August 2021, of which PAG's investment was about 2.8 billion US dollars (about 18 billion yuan). According to the content of the previous VAM agreement, if Zhuhai Wanda Commercial Management fails to complete the listing work by the end of 2023, Wanda Commercial Management is obliged to repurchase shares from the above-mentioned investors. If Zhuhai Wanda Commercial Management is unable to go public by the end of this year, a repurchase agreement will be triggered, and Wanda's cash flow may also be under pressure. As early as half a month ago, Wanda began to negotiate with various investors about the plan to postpone the listing.
At that time, Wanda proposed to investors a plan to pay 30 billion yuan of equity repurchase money and corresponding interest in installments over four years. On the condition that Wanda provide investors with an additional 20% equity interest in Zhuhai Wanda Commercial Management as collateral.
But investors are not buying the extension, which has put pressure on Wanda to come up with more generous terms with only about a month left on the payment deadline.
Now it seems that Wanda has given investors satisfactory terms, and investors no longer require Wanda to pay the equity repurchase money according to the original agreement.
According to the new agreement, Dalian Wanda Commercial Management holds 40% of the shares, making it the single largest shareholder, and several existing and new investor shareholders such as PAG participate in the investment, holding a total of 60% of the shares. Wanda will work with PAG and other important shareholders to further optimize the company's corporate governance, maintain the stability of the management team, and jointly support the company's long-term development. The new agreement reflects investors' high affirmation of Zhuhai Wanda Commercial Management's growth potential and high recognition of its operating capabilities.
For Wang Jianlin and Wanda, the loss of absolute control of Zhuhai Wanda Commercial Management was not a small price, but it also temporarily survived the VAM crisis.
It is reported that Zhuhai Wanda Commercial Management currently manages 494 large-scale commercial centers in 227 prefecture-level and above cities across the country. In the past two years, the number of commercial centers managed by Zhuhai Wanda Commercial Management has grown from 417 to 494, with an average annual growth rate of about 9%. Zhuhai Wanda Commercial Management is now the world's largest commercial management company in terms of commercial area under management.
Dalian Wanda said that since the existing investors invested in 2021, Zhuhai Wanda Commercial Management has exceeded its performance target for three consecutive years, with after-tax income of 23.5 billion yuan in 2021, 27.1 billion yuan in 2022 and 29.3 billion yuan in 2023 (estimated), with an average annual growth rate of about 12%. Profit after tax was $5.3 billion in 2021, $7.5 billion in 2022 and $9.5 billion in 2023 (estimated), with an annual growth rate of 34%. In the past three years, the company has paid a total of about 10 billion yuan in taxes, and dividends to shareholders are 4.6 billion yuan in 2021, 6.7 billion yuan in 2022 and 8.5 billion yuan in 2023 (estimated).
In order to solve the liquidity problem, some time ago, Wang Jianlin also sold assets. On December 6, Wanda Film announced that 51% of the company's controlling shareholder, Beijing Wanda Investment Co., Ltd., was to be transferred to Shanghai Ruyi Investment Management Co., Ltd., a wholly-owned subsidiary of China Ruyi Holdings Co., Ltd. Earlier reported: Selling equity to save the emergency? Wanda Film is planning to change hands
Earlier, it was reported that Zhuhai Wanda Commercial Management recently revealed in the process of communicating with investors that Wanda Group plans to sell its Wanda Plaza in first- and second-tier cities in exchange for liquidity, and is currently negotiating with insurance institutions. However, Wanda did not disclose which insurance institution it approached. At the same time, as for the timing of Zhuhai Wanda Commercial Management's listing in Hong Kong, Wanda said that there is still no IPO timetable.
Editor-in-charge: Jiang Saisai
Inspector Zhang Xiaonan
Source: Dalian Wanda official website, National Business Daily, The Paper, China Fund News, Jiemian News