China's Dalian Wanda Group has announced that it is considering privatizing its commercial real estate arm. The delisting plan comes just over a year after it went public in 2014.
According to The New York Times, Dalian Wanda Commercial Properties might be delisted from the stock exchange in a deal to be worth as much as US$4 billion. Meanwhile, the company said in a statement that the plan is still its early stages of consideration and so it is not yet 100 percent sure to materialize. It has not given any reasons as well yet as to why it its mulling on going private soon after its first initial public offering. According to Hong Kong Economic Times, as cited by China Daily, the move has been triggered by a demand from shareholders for a comeback in the A-share market.
Dalian Wanda said that it would offer no less than HK$48 or US$6.20 per share which is 24 percent higher than its closing amount on Wednesday. On Thursday, the company's shares closed at $45.95 a share, boosted by the announcement.
The company was established in 2002 and went in public in 2014 in what was dubbed as the largest listing in Asia for that year after raising a whopping $3.7 billion. China Daily said that according to analysts, that move was driven by financial challenges in China which has a lower cost of issue bonds now. China has also been experiencing a housing glut and property investment's growth has been flat, resulting in introduction of measures to cool down the market.
Dalian Wanda Commercial Properties deal with projects such as shopping centers, theaters, hotels, offices and residential. Its parent Dalian Wanda Group has been venturing in the film industry as of late and announced that it is acquiring Legendary Entertainment in Hollywood for a $3.5 billion deal.
