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Chinese developer Sunac to buy US$9.3b of Wanda assets
[SHANGHAI] Property Developer Sunac China Holdings plans to spend US$9.3 billion on 76 hotels and a majority stake in 13 other projects from Chinese conglomerate Wanda, the two companies announced on Monday.
They gave little explanation for the deal, but Wanda is among companies that have been the target of official scrutiny into potentially risky loans stemming from a wave of overseas acquisitions by Chinese firms.
Wanda, headed by one of China's richest men, Wang Jianlin, had been one of the most acquisitive companies abroad, spending billions on a range of US entertainment properties.
But Beijing began last year to roll out measures to stanch the flood of cash overseas, fearing capital flight, a weakening currency and expressing concerns over "irrational" investments.
Last month, Wanda acknowledged that China's banking regulator had ordered an inspection of potentially risky loans to it and other major Chinese companies that have invested heavily overseas.
Monday's statement did not give details on the 76 hotels.
But the companies said Sunac would take a 91 per cent stake in 13 other "cultural and tourism projects" owned by Wanda, a commercial property developer that has diversified into entertainment, theme parks, and sports, partly as a buffer against Chinese real-estate volatility.
The planned purchase is the latest aggressive move by fast-growing Sunac, which has struck a number of recent deals.
In January it invested US$2.2 billion in Chinese tech firm LeEco, which has acknowledged that it expanded too rapidly and was now facing a cash crunch.
Sunac, which is listed in Hong Kong, had suspended its shares ahead of the announcement.
Wanda Hotel Development, the group's listed unit in Hong Kong, surged 94.83 per cent to HK$1.13 by the break.