Wanda Considering IPO for Sports Unit and Overseas Asset Sale

The Dalian Wanda Group, based in China, is considering a listing in Hong Kong for the sports assets it has as part of the company efforts to streamline its portfolio that may also include sales of other assets said people close to this situation.

The Chinese conglomerate in December spoke to investment banks related to a possible initial public offering for its sports business, said sources. The largest brokerage in China, Citic Securities is one bank involved said the sources.

Wanda’s businesses include football to real estate and cinemas. However, the company has been shaken over the last year by a crackdown led by the government on deals overseas and high leverage. Wanda’s owner is Wang Jianlin, one of the richest men in China.

An IPO of the sports assets of Wanda would include the Swiss sports market business Infront Sports & Media as well as World Triathlon Corp, the promotor and organizer of the Ironman Race, said sources.

Those two companies were acquired for $1.2 billion and $650 million respectively in 2015.

The IPO would include Wanda’s smaller China sports assets, such as its basketball and cycling leagues. The public float would not include Wanda’s 20% stake in Atletico Madrid the Spanish football (soccer) club, which has been valued at over €67 million euros following a capital raise, said sources.

The IPO is most likely going to be in Hong Kong, but bankers pitched the U.S. according to the sources.

Wanda is looking also to sell Sunseeker International, its yacht maker based in Britain that it acquired for more than $495 million in 2013 but whose performance financially has not turned around.

Wanda has made no comment on any of the reports.

The interest in sports, entertainment, and property accounting for over $13 billion of the deal over the last five years, ran into opposition from the government in 2017 when Beijing labeled deals made overseas in those different areas as being irrational.

In addition to its sports holdings, it also has AMC Entertainment Holdings the cinema chain and Legendary Entertainment a movie studio.

The company has also considered the merits of a funding round prior to the IPO for its sports unit, said people close to the matter.

All the mentioned plans remain in the early stage, but Wanda is searching for a CFO for its sports business to leads efforts for fundraising.

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