Wang Jianlin’s Wanda unit gets a US$8.4 billion capital injection from PAG-led consortium

Wang Jianlin’s Newland Commercial Management received close to 60 billion yuan from five investors
The investors led by PAG comprise Citic Capital, Ares Management, Abu Dhabi Investment Authority (ADIA) and the Mubadala Investment Company

Dalian Wanda Group

Yuke Xiein Beijing

Published: 9:43pm, 30 Mar 2024

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A consortium of investors agreed to inject capital into a unit owned by the Chinese property magnate Wang Jianlin, offering some relief to a cash-starved developer who has had to sell assets to repay debt.

Wang’s Newland Commercial Management unit has received close to 60 billion yuan (US$8.4 billion) from a consortium comprising PAG, Citic Capital, Ares Management, Abu Dhabi Investment Authority (ADIA)’s wholly-owned Platinum Peony unit, and the Mubadala Investment Company, according to separate statements published on Saturday.

After the capital injection, the five investors will own a 60-per cent combined stake in Newland, while Wang’s Dalian Wanda Commercial Management Group will hold the remaining 40 per cent.

Newland, founded in January with 16.21 billion yuan in registered capital, is an investment holding company that controls Zhuhai Wanda Commercial Management, an operator that manages 496 large shopping malls across China.

Dalian Wand Group’s founder and chairman Wang Jianlin, in Los Angeles on October 17, 2016. Photo: Los Angeles Times/TNS.

The capital injection followed the restructuring last December of Zhuhai Wanda by PAG and Wanda Commercial, which contained the provision for PAG and its partners to raise their stake to 60 per cent. Wanda Commercial would cut its stake to 40 per cent from 78.9 per cent, under the agreement.

The restructuring was Zhuhai Wanda’s second attempt at recapitalisation, following a 38 billion yuan investment in August 2021 by PAG, Ant Group and Tencent Holdings and other investors.

Dalian Wanda Group’s Wanda Plaza building in Beijing on May 17, 2016. Photo: Reuters

Dalian Wanda Group, the parent of Wanda Commercial and the country’s largest shopping centre operator, has been grappling with a liquidity crisis over the past two years, and has been selling assets to repay debt.

Earlier this year, Wanda sold its Shanghai luxury hotel Wanda Reign to Singapore-based Pacific Eagle Real Estate, the property investment and development arm under Indonesian pulp and paper billionaire Sukanto Tanoto.

Last July, the group warned of a funding short fall just a few days before redeeming a US$400 million bond. In November, it won the consent from bondholders to extend the maturity of a US$600 million bond by 11 months.

The latest investment “reflects the expectation and recognition that global institutional investors have for the long term development of Newland,” said PAG’s partner David Wong. “We think Newland has strong competitive barriers and significant first-mover advantage that can support its steady business performance in the long term, as well as generate good returns for investors.”

Citic Capital’s chairman Zhang Yichen also expressed confidence in Newland’s competitive advantage and development outlook, adding that he is “consistently optimistic about China’s consumer and retail segments.”