BEIJING // The Spanish football champions Atletico Madrid are battling Real Madrid and Barcelona to retain their crown, and are also in with a shout in the European Champions League.
A continent away, China’s largest commercial property company, Dalian Wanda, will be keeping a close eye on Atletico’s La Liga and European progress.
Not so much a family business, although it is wholly owned by a father and son team, it is more a multinational one-man band. The firm is involved in everything from shopping mall construction, cinema-building, film distribution and screening, and related business such as advertising.
The company was founded 26 years ago and is still 98 per cent owned by Wang Jianlin, who is also the chief executive. His only son, Wang Sicong, 26, is on the board of Wanda Group, holding the rest of the company.
In 1988, Mr Wang took over a struggling state-owned property company that was 6 million yuan (Dh3.52m) in debt. “The government was freaking out and said whoever can turn it around will get the company for free,” Mr Wang says. “I thought to myself, ‘If I get some bank loans and land, it should be possible’.”
It certainly was.
A former People’s Liberation Army officer who, depending on which Rich List you read, is either China’s richest, second-, or third-richest man, Mr Wang today owns a company that last year had assets of 534.1 billion yuan, which marked a year-on-year growth of 34.5 per cent.
Income reached 242.48bn yuan, up 30 per cent, the ninth year in a row that annual income rose more than 30 per cent.
Wanda last year opened 24 new department stores, growing its total portfolio to 99 stores across the country. Income from these malls reached 25.6bn yuan, 101.6 per cent ahead of plan and a year-on-year increase of 65.3 per cent.
Mr Wang believes Wanda will be among China’s first group of “real” multinational companies, and he has often stated that his group would firmly adhere to its internationalisation strategy.
A key part of this strategy is growing Wanda. “Our strategy is self-development, but that is not enough,” Mr Wang says. “The main development still depends on mergers. There will be at least three mergers in the culture industry. In 2015, Wanda’s income from culture industries will break through 45bn yuan. By 2020, Wanda will reach 100bn yuan in the culture industry, becoming one of the top-five culture companies in the world.”
His transformation plans envisage 65 per cent of net profits coming from services income, with property accounting for less than 35 per cent. Overseas revenues should account for more than 20 per cent of total sales revenue, he says.
His biggest overseas deal to date was the purchase in 2012 of the AMC cinema chain, North America’s second-biggest theatre chain, for US$2.6bn.
With a stroke he became a major world player in the cinema market and also gained valuable access through the AMC theatres to a host of shopping malls in the United States.
Investment in the culture industries is something Mr Wang takes very seriously.
Income from Wanda’s culture unit last year was 34.14bn yuan, a rise of 32.3 per cent on the previous year.
In December, Wanda opened two major cultural projects, the Han Show and Wanda Movie Park, both in the central city of Wuhan, and half a year’s worth of tickets were quickly sold out.
Last month, he listed the shares of Wanda Cinema Line, which is China’s largest cinema operator, and they rose to reach the stock exchange-imposed limit of a 44 per cent gain during their trading debut on the Shenzhen exchange.
This month, Wanda bought the Swiss sports marketing company Infront Sports & Media Group from the private equity group Bridgepoint for $1.2bn.
Infront is the exclusive sales representative for distribution of broadcast rights to the 2018 and 2022 Fifa World Cups, and it handles media and marketing for the Chinese Basketball Association. It is run by Philippe Blatter, a nephew of Sepp Blatter, the president of Fifa, football’s global body.
Mr Wang is also building an $8.2bn film studio, amusement park and property development in the eastern Chinese port city of Qingdao, which is slated to open in 2017, and he will launch a major film festival and awards show at the planned complex.
In September 2013, Wanda brought over Hollywood A-listers including Leonardo DiCaprio, Nicole Kidman and Harvey Weinstein, reportedly spending millions of dollars to do so, to launch the Qingdao project.
A key part of his plans for overseas expansion involves establishing Wanda as a player in Hollywood.
Mr Wang spent $1.2bn on a plot of land at 9900 Wilshire Boulevard, Beverly Hills, for the headquarters of Wanda’s entertainment business.
The Beverly Hills facility was also expected to help China’s entry into Hollywood’s film industry and generally promote Chinese culture abroad.
And then there is the football. In 1993, Mr Wang was involved in setting up Dalian Wanda FC, China’s first professional football club.
He has said he will retire in six years, when he will be 66, and focus on rejuvenating China’s national football team, which made one dreadful appearance in the World Cup in 2002 and has since struggled amid rank corruption and poor performances.
This is a similar view to that held by the Chinese president Xi Jinping, who has often bemoaned the dreadful state of the national side.
Some say his move to buy 20 per cent of the La Liga team was motivated by both political and commercial interests – he can help give Chinese football a boost while at the same time making money by promoting Atletico in China. La Liga is more popular than most foreign leagues in China, as it is easier to access than the others.
His plans for Atletico Madrid are to build 200 retail outlets around Wanda’s chain of malls throughout China, selling authentic merchandise – that would be the biggest network of retail stores ever established for one European team outside its home turf.
Atletico will collaborate with the Chinese Super League club Shanghai Shenshua as part of what is known as “Project Wanda”, boosting the game among young players and ultimately raising the profile of football in the world’s most populous country.
By 2017, Wanda aims to invest €20 million (Dh83.8m) annually to support the development of 180 young Chinese players in Spain.
“This investment will not only provide a golden opportunity for young Chinese players sent overseas by Wanda to be selected by leading European football clubs, it will also strengthen the quality of Chinese football and narrow the gap between it and the rest of the world,” Mr Wang says.
It may well prove a great way for Mr Wang and Wanda to achieve their goals financially, too.
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