China’s Wanda buys Hollywood film company Legendary Entertainment for $3.5 billion

The producer of the “Dark Knight” Batman trilogy and “Godzilla” paves the way for China to broaden its influence over USA mainstream films beyond cameos of Chinese actors.

The Chinese group said Tuesday it will buy Legendary Entertainment for $3.5 billion.

Wanda appears to have acquired a majority stake in the studio from SoftBank and other current shareholders, with Legendary founder Thomas Tull left holding the remaining shares and keeping his current posts of chairman and CEO.

In 2012, Wanda purchased AMC Theatres, the second-largest American cinema chain, for US$2.6 billion and, in 2013, it began construction of a mammoth US$8.2 billion studio complex in eastern China, flying in stars such as Leonardo DiCaprio and John Travolta to mark the occasion.

The deal has been agreed for a fee in the region of $3.5 billion (£2.4 million). Films for a global market would have to pass the censorship laws in all bits of that market and the Chinese censor is ultra-strict on politics. That deal would allow Legendary to more easily produce films in China – and thus release them without having to work with the quota China’s government places on foreign films.

“This was certainly a very big incentive for Legendary”.

Chairman of the Wanda Group, Wang Jianlin believes that his company could acquire even bigger groups in the coming days as Dalian looks to become more prominent at the global level.

Buying Legendary fits Wanda’s goal of creating a global media company and becoming a major player in film production. Daniel were… the great wall… starring Matt Damon and another public Chinese star Andy Lau…is directed by a one of China’s most acclaimed filmmakers… Sprawling across 400 acres, Wanda Studios Qingdao will house 30 soundstages, a permanent facsimile of a New York City street, as well as China’s largest exterior water tank and postproduction facilities.

Besides the two biggest film markets in China and the US, Wanda is also looking for purchasing opportunities in Europe, especially in Germany, England and France, Wang said.

China’s strict co-production rules require a significant amount of Chinese content, including shooting locations and language, stoking fears that the new deal could be a means for Beijing to project its “soft power”.

At the same time, Hollywood has tried to cater to Chinese audiences by spotlighting local actors and themes.