Wanda unit aiming to create fund of up to 90b yuan backed by malls: sources
It hopes to complete the fundraising by 2025
CHINA’S biggest mall operator, Dalian Wanda Commercial Management Group, has told some investors that it plans to establish a fund of about 50 billion yuan (S$9.3 billion) to 90 billion yuan to pay taxes and debt, sources familiar with the matter said.
The key unit of Wanda Group, among the few major Chinese real estate companies to avoid public defaults during an unprecedented property crisis, aims to complete the fundraising by 2025, company officials said in meetings with bondholders in Hong Kong this week, according to the sources.
The firm has a tax obligation that stems from the sale of its stake in its mall-operating arm to a consortium led by Asian investment firm PAG.
That tax liability could total about 10 billion yuan this year and next, the sources said, citing information shared in a meeting.
The details are subject to change pending discussions with regulators, they said.
The conglomerate has been fending off stress amid China’s economic slowdown and property market crisis, as it shifts to an “asset-light” business model.
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Wanda was forced in recent years to shed assets that once brought it clout, including a stake in Spanish soccer club Atletico Madrid and the cinema chain AMC Entertainment Holdings.
More recently, an entity affiliated with the group took steps to sell a yachtmaker whose boats were featured in James Bond movies.
The noteholder meetings this week were held after Wanda Commercial announced a plan on Monday (Nov 25) to extend a US dollar bond due in 2025 by nearly one year.
The company sold or pledged for loans more than 10 properties this year and is in negotiations to sell more malls, according to the sources.
It has teamed up with two private firms to create the fund and is seeking investments from players such as insurance companies, said the sources.
The fund would be backed by at least about 50 malls as underlying assets, they added.
Wanda Commercial also intends to allocate a portion of the funds to repay its 2026 US dollar bond, but will not rule out the possibility of extending its maturity if there is a delay in setting up the fund, the sources said.
Wanda declined to comment. BLOOMBERG
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