The massive Chinese entertainment company Dalian Wanda Group has been gobbling up domestic entertainment companies, and the next one on its list could be Paramount Pictures. Reuters and The Wall Street Journal report that the company has been in talks with Viacom, Inc. about acquiring a 49 percent stake in the movie studio as part of its expanding entertainment business.
Earlier this year Wanda Group made its first investment in a major Hollywood film when it co-financed Paramount’s Teenage Mutant Ninja Turtles: Out of the Shadows, but the company had been picking up US entertainment companies long before that. In 2012, Wanda acquired the AMC Entertainment theater chain for $2.6 billion, and in January of this year it purchased Legendary Entertainment — the mini-studio behind The Dark Knight trilogy, Warcraft, and potentially a new Pokémon movie — for $3.5 billion. That’s all on top of Wanda’s primary business in China as a property developer, but the entertainment deals have helped make it the largest movie theater chain operator in the world.
The latest in a series of high-profile investments
According to the WSJ, Viacom is looking for a deal valuing Paramount Pictures between $8 to $10 billion, but the reports note that another unnamed party is also interested in picking up the stake in Paramount, and that Wanda may not end up closing the deal. Further complicating the issue are internal political matters at Viacom. While the arrangement is reportedly supported by CEO, president, and chairman Philippe Dauman, it’s said to be opposed by former chairman Sumner Redstone. Redstone recently took steps to prevent any kind of Paramount deal going through without the approval of both himself and his daughter, Shari Redstone.
Partnering with Wanda would bring Paramount and Viacom a welcome influx of cash, and set them up for greater success overseas. That latter point has become of particular interest to Hollywood in recent years as the industry has looked to expand into new markets. Domestic movie attendance peaked in 2002, and has been trending downward ever since. China, on the other hand, is growing faster than anticipated, and is expected to surpass the United States as the world’s biggest movie market in the next two years.