China's Wanda Group in Talks to Acquire Dick Clark Productions
September 26 2016 - 6:30PM
Dow Jones News
China's richest man is going for glamour with his latest
Hollywood blockbuster.
Billionaire Wang Jianlin is in discussions to acquire control of
Dick Clark Productions at a valuation of about $1 billion through
his Dalian Wanda Group Co., according to people with knowledge of
the situation. Dick Clark Productions would be the latest trophy in
an empire that includes theater chain AMC Entertainment Holdings
Inc. and movie producer Legendary Entertainment.
If completed, the deal would give China's Wanda the television
production company that stages some of Hollywood's glitziest and
most popular awards shows, including the Golden Globe Awards and
the American Music Awards.
One of the people cautions that the talks are still at an early
stage and there remains a valuation gap between the two sides.
Some of the people said that Wanda has been the leading bidder
for the company in discussions over recent weeks. However, the
talks could still fall apart, and it remains unclear if a competing
bid could emerge late in the game. The company has been shopped by
Dick Clark Productions' bankers to a number of Chinese buyers
including major companies and private-equity firms.
Wanda is known in China primarily as a commercial property
developer. But in recent years the company has become an aggressive
buyer of entertainment assets overseas—from movie theaters to a
production company to sporting events. At home, Wanda is building
theme parks to counter Walt Disney Co.'s push into mainland
China.
Dick Clark would be Wanda's biggest foray into U.S. television
assets and builds on its interest in Hollywood-related deals.
TheWrap previously reported that Dick Clark Productions was looking
to sell to a Chinese buyer at a $1 billion valuation.
Founded in 1957 by the late television personality, Santa
Monica-based Dick Clark Productions was sold to a group of
investors led by investment firm Guggenheim Partners in 2012 for an
undisclosed value. Late last year, Guggenheim sold Dick Clark
Productions and a couple of other media assets to a company
controlled by Guggenheim's then-president, Todd Boehly, who took a
step back from Guggenheim to man the newly formed company Eldridge
Industries. Mr. Boehly, now the CEO of Eldridge, remains on the
executive council at Guggenheim.
Wanda, a property-to-entertainment conglomerate, could bring to
China some of the world's most viewed live TV programs. The Golden
Globes attracted 18.5 million viewers this year, while the 2016
Billboard Music Awards drew about 9.6 million viewers and the 2015
American Music Awards drew about 11 million viewers. Beauty pageant
"Miss America," another event run by Dick Clark Productions, also
gets millions of domestic American viewers.
Betting on the brand of live event programming owned by Dick
Clark Productions holds some risks, given that big awards shows
like the Emmy Awards, Golden Globe Awards and Oscars experienced
ratings drops this year, along with a broader dip in TV ratings.
Viewership for the Golden Globes, for instance, slipped 4.2% this
year from a year ago.
Despite the recent declines, big television spectacles are still
coveted by advertisers looking to reach broad audiences.
The purchase comes after Wanda's failed pursuit this year of a
49% stake in movie studio Paramount Pictures, which is owned by
Viacom Inc. Viacom's newly expanded board announced last week that
it decided not to sell a stake in Paramount, a plan that had been
opposed by controlling shareholder Sumner Redstone.
Wanda's ambitions in Hollywood seemingly have no limits. Early
this year, Wanda paid $3.5 billion to take over Legendary
Entertainment, which has produced summer blockbusters including
"Pacific Rim," "Godzilla" and "Jurassic World."
Mr. Wang also owns the U.S.'s No. 2 movie-theater operator AMC
Entertainment, which it bought in 2012 for about $2.6 billion, and
is seeking to acquire the Carmike Cinemas chain, which would make
him the largest theater operator in the U.S. He also has agreed to
buy Europe's largest cinema chain, Odeon & UCI Cinemas Group,
for $650 million.
In another deal announced last week, Wanda said it was teaming
up with Sony Pictures Entertainment Inc. to help market its films
in China. Under the deal, Wanda would promote Sony films to Chinese
moviegoers through its ticketing platform and entertainment
venues.
Wanda could also showcase Sony films on its more than 2,000
screens in China, and, according to a person familiar with the
arrangement, it will have the option to buy a small stake in some
films it helps market, if Sony agrees.
Mr. Wang also is building a chain of entertainment theme parks
in China, including an Oriental Movie Metropolis in Qingdao that
will include film production studios.
Write to Shalini Ramachandran at shalini.ramachandran@wsj.com,
Rick Carew at rick.carew@wsj.com and Kane Wu at Kane.Wu@wsj.com
(END) Dow Jones Newswires
September 26, 2016 18:15 ET (22:15 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
Sony (NYSE:SONY)
Historical Stock Chart
From Aug 2024 to Sep 2024
Sony (NYSE:SONY)
Historical Stock Chart
From Sep 2023 to Sep 2024