One firm neatly sums up China’s international ambitions – the mighty Wanda Group. The company started life as a local commercial property venture and is now China’s largest player in this sector owning a string of Wanda Plazas (huge shopping and entertainment centres, there are 107 in total across China) as well as a chain of hotels and numerous other developments.
Success at home was satisfyng but the allure of developing a global business empire proved too strong for Wang Jianlin the group’s Chairman and supposedly Asia’s richest man. Under his guidance the Wanda group branched out into the entertainment business buying a chain of ailing US cinemas (AMC Group) and building a film studio in Qingdao on the North East Coast of the country with the aim of developing a Chinese Hollywood, a world class centre for international and domestic film production, which when fully operational in 2017 will produce over 100 movies a year.
The rise of China friendly movies has been noted by many and the demand for these productions will rise in tandem with Chinese cinema attendances. Some analysts even suggest that this move into the cultural realm has been backed by the government in Beijing who are keen to increase the nation’s soft power.
If that was not enough the Wanda group have also developed several other high profile projects:
- A huge hotel in Vauxhall in London, part of a major redevelopment of this area on the South bank of the River Thames, when finished it will be one of Europe’s biggest residential buildings.
- Wanda have also brought Sunseeker, the luxury yacht maker. This could allow the firm to capitalise on China’s yacht boom.
- Earlier last year Dalian Wanda took a stake in Athletico Madrid, a major Spanish football club and winners of La Liga last season. Many other foriegn billionaires have been snapping up European football clubs and it was just a matter of time before a Chinese investor took the plunge.
- Much less reported was Wanda’s move to buy an obscure Swiss firm Infront Sports and Media which handles the TV rights for major tournaments like the World Cup and the Olympics. This will give Wanda a ring side seat to the world of sports business and lay the ground for further expansion and acquisitions in this sector.
Wanda’s growth abroad has been perhaps hastened by the slowing Chinese economy and in parts an unhealthy property market. Wanda’s challenge now will be to successfully manage a geographically wide ranging and sectorally diverse company.
Many believe the firm has ambitions to become a Chinese Walt Disney – both a huge company and a global brand. If it can achieve that then it would be a notable first for a Chinese firm, who have traditionally struggled to make an impact in brand and identity terms on an lnternational scale.
Dalian Wanda’s financials are impressive, it has seen nearly all financial metrics improve over the last three years, revenues for example have nearly doubled from 2012 to 2014, this is all despite a slowing property market in its home territory.
Wanda was well placed to avoid the expected Chinese slow down – by focusing on prime locations in secondary cities it has avoided the pitfalls of over expansion into smaller cities and imperfect locales. It has also attempted to integrate online shopping into the mall “experience” by developing technology to allow shoppers to select items at home and pick up in store or select while shopping and then receive home delivery.
Wanda Group’s profile means it is well placed to take advantage of the transition to a consumer based economy, which means huge demand for entertainment, consumer goods and luxury items. Abroad its attempts to construct a cultural powerhouse will be backed by Beijing, but it will be intriguing to see whether there is a backlash against Chinese businesses making high profile acquisitions. In particular the US Presidential election this year means many Republican candidates gunning for China.