Wanda Commercial Halted as Billionaire Owner Wang Pursues Buyout

Dalian Wanda Commercial Shares Suspended
  • Dalian Wanda Commercial asked for halt pending announcement
  • Suspension related to takeovers and mergers code of exchange

Dalian Wanda Commercial Properties Co.’s shares were suspended on Monday following a request by the company to the Hong Kong stock exchange, as billionaire Wang Jianlin pursues a plan to take the developer private.

The company requested the suspension "pending the publication of an announcement pursuant to the Hong Kong Code on Takeovers and Mergers,” according to a statement to the exchange on Monday.

Wanda Commercial’s parent company, Dalian Wanda Group, controlled by Wang, has been seeking investors to help purchase as much as 14.41 percent of the Hong Kong-listed property company and re-list in mainland China, according to a document sent to prospective backers. That 14.41 percent figure represents the portion of the company not controlled by Wang and other mainland shareholders.

If the developer has not gone public on a mainland exchange by either Aug. 31, 2018, or two years from the Hong Kong de-listing, Wanda Group will buy back the shares at a level guaranteeing a 12 percent annual return for domestic investors and 10 percent for those overseas, according to the document,  a copy of which was obtained by Bloomberg News.

The proposal promises a "relatively large room for arbitrage" for investors given that the property arm’s Hong Kong-listed shares are "seriously undervalued," the company said in the document.

The parent company said on March 30 it was considering offering HK$48 or more for the developer’s Hong Kong shares, which jumped as much as 22 percent on the news. Wanda Commercial’s shares closed up 2.1 percent to HK$51.25 on Friday, bringing the gain this year to 13 percent.

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