As an update from an earlier post, we see Donald Trump stepping in to save what little American industry remains.
For additional information on the Chinese invasion and infiltration of Hollywood, see the following previous posts:
Sources close to the situation still expect Wanda to close the acquisition sometime in February, and say that the only speed bump has been that some details are still being worked out. With the Chinese New Year holiday beginning on Saturday, work is expected to be halted for at least the next week.
One person said that work on the deal also came to a standstill a few weeks ago, amid concerns that the nationalistic focus of the new Trump administration might mean greater scrutiny to big investments in the U.S. by Wanda, Alibaba and the new breed of Sino mega conglomerates. The Dick Clark Prods. transaction was only the most recent mega-acquisition for Wanda, which also bought Legendary Entertainment for $3.5 billion last year and AMC Theaters for $2.6 billion in 2012. Wanda’s buying spree has caught the attention of members of both parties in Congress, who worry that they could mark a strategic extension of Chinese “soft power.”
Chinese overseas investment jumped by 50% in 2016, according to an estimate compiled by the American Enterprise Institute. The U.S. was by far the largest recipient with a record-setting $50 billion of Chinese investment.
However, China has been taking steps to curtail overseas investment. AEI projects that the number of Chinese deals will decline in 2017. China’s efforts to stem capital flight could pose a complicating factor as Wanda seeks to close the Dick Clark Productions deal. In December, Chinese metals company Xinke abruptly and mysteriously dropped its deal to buy a majority stake in Voltage Pictures for $345 million, opting to buy a Hong Kong entertainment company instead. Voltage is now suing to recover a $4 million deposit.
In Hollywood, observers are still astounded at the $1 billion price tag for DCP. Guggenheim Partners bought the company in 2012 for $370 million, and at the time many considered that price to be inflated. Dick Clark Productions in late 2015 changed hands again when investor Todd Boehly left Guggenheim, taking DCP, the Hollywood Reporter, Billboard and other assets with him to the new Eldridge Industries banner.
With Dick Clark Prods., sources said the company is moving forward as if the Wanda acquisition is a done deal. There’s excitement at the prospect of being part of a larger entity with ample resources at its disposal. But getting the deal to the finish line is proving more complicated in the current political climate than both sides expected.
Full article: Wanda Faces Hurdles in Closing Dick Clark Prods. Deal (EXCLUSIVE) (Variety)