Bottom line: DreamWorks Animation’s withdrawal from its China joint venture marks the end of an explosive phase in China-Hollywood tie-ups, with one-off co-production deals the most likely form of cooperation going forward.
Take-two for DreamWorks Animation China JV
In what could herald a wave of the future, a highly-touted joint venture between DreamWorks Animation and Shanghai’s China Media Capital (CMC) has come unglued, with the official departure of DreamWorks from the tie-up. This particular exit appears quite symbolic, as Oriental DreamWorks was the first of what ended up becoming a huge wave of similar tie-ups between China and Hollywood. Thus the big question becomes if this abandonment of the venture could signal more unraveling of similar tie-ups ahead.
I suspect the answer to that question is yes, but perhaps not for the reasons you might expect. It appears that DreamWorks Animation’s decision to quit the joint venture owed to disappointing results, and I suspect the company’s acquisition by Comcast two years ago was also a factor. The fact of the matter is that China’s movie market still has huge potential. But Beijing has shown less appetite for these China-Hollywood tie-ups these days, less for political reasons and more because it is trying to stem the outflow of money for foreign acquisitions. Read Full Post…
Bottom line: Foundering prospects of cross-border tie-ups involving DreamWorks and Paramount shows the love affair between Hollywood and China may be entering a new phase of lowered, more realistic expectations.
DreamWorks Animation eyes sale of China JV stake
The old saying says that what goes up must come down, and that certainly appears to be the case with new reports of the unraveling of two more China-Hollywood tie-ups. The latest reports say that US giant DreamWorks Animation is looking to sell out its stake in Oriental DreamWorks, its landmark China animation joint venture that was launched with fanfare 5 years ago. At the same time, another report is saying a $1 billion film production tie-up between two Chinese partners and Paramount is reportedly running into trouble due to turmoil at the Hollywood studio.
The unraveling of these two major deals comes just weeks after another deal involving Wanda Group’s planned purchase of Dick Clark Productions also appears to be coming unglued. In that case the culprit is China’s recent currency controls, which were preventing Wanda from getting the necessary funds outside the country to complete the $1 billion purchase. But Wanda was apparently also worried it was overpaying for the asset. Read Full Post…
Bottom line: Wanda will continue to operate its ffan e-commerce site for another year, following the departure of its CEO, but could quietly end the initiative afterwards due to lack of synergies with its brick-and-mortar shopping malls.
Success evades Wanda in e-commerce
The headlines have been buzzing this week about the departure of the chief executive of the e-commerce unit Wanda Group, the real estate-turned-entertainment giant with a voracious appetite for global acquisitions. The big theme from the chatter is that the departure of Li Jinling, the unit’s third CEO in 3 years, marks a setback and possibly even presages a death knell for the Wanda initiative into the online shopping realm.
Wanda is speaking out on the subject, saying it never intended to launch a website that would compete directly with the likes of sector leaders Alibaba (NYSE: BABA) and JD.com(Nasdaq: JD). Perhaps that’s true, though that didn’t stop Wanda and its ultra-confident chief Wang Jianlin from boasting of lofty ambitions when it signed up Internet titans Baidu(Nasdaq: BIDU) and Tencent (HKEx: 700) as partners to its ffan e-commerce site in 2014. Read Full Post…
Bottom line: Wanda’s cautionary words to Donald Trump are unlikely to have much impact on the incoming US president, who is likely to take a more skeptical view of Chinese M&A in Hollywood.
Wanda appeals to Trump via MPAA
Wanda Group founder and chief Wang Jianlin is used to getting what he wants, especially when it comes to overseas buying as he tries to build up a global entertainment empire. But one of China’s richest men is clearly rattled by the ambivalent or even hostile attitude towards his country by US president-elect Donald Trump.
Worried about the changing winds in Washington, Wang has turned to Hollywood’s mouthpiece, the Motion Picture Association of America (MPAA), to tell Trump that Hollywood could face huge consequences if he tries to shut down China’s recent buying binge. Wang has been Hollywood’s most enthusiastic shopper these days, purchasing cinema operator AMC Entertainment (NYSE: AMC) and studio Legendary Entertainment over the last few years. He also announced a recent deal to buy Dick Clark Productions, and recently signed a major co-production deal with Sony Pictures. Read Full Post…
Bottom line: Wanda’s first major made-for-China sporting event, a bicycle tour of scenic Guangxi province, looks like a well-conceived initiative that could auger well for its longer-term effort to tap the Chinese sports market.
Wanda launch Guangxi cycling event
Following its opening of several massive theme parks across China, entertainment aspirant Wanda Group has just announced the launch of what it hopes will become one of the nation’s premier sporting events that can earn a place on the global bicycling map. That announcement has Wanda pedaling its new Tour of Guangxi event, which will take cyclists through one of China’s most scenic provinces that includes the famous craggy mountains surrounding the city of Guilin. Read Full Post…
Bottom line: China’s Wanda Group will continue a recent trend of hunting for top global talent to build its growing entertainment empire, as it seeks to challenge the likes of Disney.
The aggressively expanding Wanda Group is filling up its ranks with foreign-trained China veterans as it tries to challenge the likes of global names like Disney (NYSE: DIS) with moves into the movie and theme park spaces. Now the company is going on a major shopping spree for top talent from some of those companies, led by new reports that it has just poached a top Disney theme park executive to head its own theme park division. At the same time, other reports are pointing out that Wanda also recently hired Google’s (Nasdaq: GOOG) former top China executive to help lead its Internet division. Read Full Post…
The following press releases and news reports about China companies were carried on October 19. To view a full article or story, click on the link next to the headline.
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China’s Wanda Courts Hollywood With Film Subsidy (English article)
China Life (HKEx: 2628) Invests $2 Bln In Starwood Capital Hotel Portfolio (PRNewswire)
China Unicom (HKEx: 762) Says Profit in First 3 Quarters Down 80.6 Pct (HKEx announcement)
UCar to Raise 10 Bln Yuan in Bet on Car E-commerce (Chinese article)
Honda (Tokyo: 7267) planning new China car factory for 2019 start: sources
The following press releases and news reports about China companies were carried on October 18. To view a full article or story, click on the link next to the headline.
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Qualcomm (Nasdaq: QCOM) Files Patent Suits Against Meizu in US, Germany, France (Chinese article)
US Approves NXP (Nasdaq: NXPI) to Sell Standard Products Business to China Buyer (GlobeNewswire)
Wanda Hires ex-Disney (NYSE: DIS) Exec to Lead Theme Park Drive – Source (English article)
Qunar (Nasdaq: QUNR) Resumes Relationship With Airlines After 3 Month Break (Chinese article)
Suntech Announces Withdrawal from EU Price Undertaking (PRNewswire)
The following press releases and news reports about China companies were carried on October 15-17. To view a full article or story, click on the link next to the headline.
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ChemChina, Sinochem in Talks on Possible $100 Bln Merger: Sources (English article)
Tencent (HKEx: 700) to Sign $3.5 Bln Loan to Finance Supercell Purchase (Chinese article)
Weibo (Nasdaq: WB) Has Nearly Eclipsed Twitter (NYSE: TWTR) by Market Value (English article)
Smartisan Denies Rumors to be Aquired by NetEase (Nasdaq: NTES) (Chinese article)
Tongcheng Eyes IPO in 3 Years After Merger with Wanda Travel (Chinese article)
Bottom line: Alibaba will have to spend more heavily to rid its marketplaces of trafficking in pirated goods, while its Steven Spielberg partnership is part of a new wave of deeper film tie-ups between China and Hollywood.
Alibaba ties with Spielberg’s Amblin
Internet giant Alibaba (NYSE: BABA) is being rebuffed and embraced in the US in 2 separate headlines, reflecting conflicting feelings many Americans have towards one of China’s largest private companies and their sometimes controversial business practices. In the more upbeat headline, Alibaba’s movie-making unit has just signed a major new tie-up with director Steven Spielberg to co-produce movies from his Amblin Entertainment and distribute them in China. But in a far less friendly overture, Alibaba is also being blasted by a major US apparel group for lack of progress in its battle to stamp out trafficking in pirated goods in its online marketplaces. Read Full Post…
Bottom line: Tongcheng’s merger with Wanda’s travel unit could create a strong new rival to counter Ctrip, and could become even stronger through a potential future tie-up or merger with HNA-backed Tuniu.
Tongcheng merges with Wanda Travel
For more than a year Internet giant Ctrip(Nasdaq: CTRP) has seemed almost invincible, buying up most of its major rivals one by one to consolidate its position as the nation’s leading travel agent. But the company may finally be coming up against a major rival in its bid to dominate the lucrative sector, with word that real estate and entertainment giant Wanda has bought up Tongcheng, one of Ctrip’s last remaining major rivals.
This particular tie-up is slightly unusual, as Ctrip previously invested around $200 million for a stake that was reportedly as high as 30 percent in Tongcheng, according to media reports a couple of years ago. (previous post) That would have valued Tongcheng at about $650 million, which is a fraction of the valuation of more than 20 billion yuan ($3 billion) that Tongcheng was worth, based on the latest investment by Wanda. Read Full Post…
