DALIAN Wanda Group is facing a loan freeze over its overseas acquisitions, reports the Wall Street Journal today.

Chinese regulators met the nation’s big banks on June 20 to inform them that Wanda’s foreign acquisitions, including Hollywood producer Legendary Entertainment, were subject to capital restrictions enacted last year.

Last week, reports said Sunac China Holdings Ltd is buying over 76 hotels and a majority stake in 13 other projects from entertainment and leisure giant Wanda in a deal valued at US$9.3 billion (RM40 billion).

There was little detail on the deal, but Wanda is among companies that have been the target of official scrutiny into potentially risky loans stemming from a wave of overseas acquisitions by Chinese firms.

In May, reports surfaced that negotiations between Dalian Wanda Group, owned by Wang Jianlin, and the Malaysian government had reached advanced stages for Wanda to become the master developer of Bandar Malaysia, a huge tract of valuable land in the centre of Kuala Lumpur.

The WSJ said today among the affected deals are those dating back about five years in the US and Europe.

These include American cinema chains AMC Entertainment Holdings Inc and Carmike Cinemas, yacht maker Sunseeker International, Legendary Entertainment and European theatre operators Odeon & UCI Cinemas Group and Nordic Cinema Group.

Four of those deals closed between 2012 and 2016 and the latest move appears to block Wanda from getting new financing in connection with them from Chinese banks, the financial daily said.

The aim is to stop an outflow of the yuan and policymakers are also concerned that the spiralling levels of corporate debt will hit the broader financial market.

It is uncertain if the loan freeze will also affect the Bandar Malaysia deal, which is reportedly worth US$8 billion. – July 17, 2017.