Nisha Gopalan is a Bloomberg Gadfly columnist covering deals and banking. She previously worked for the Wall Street Journal and Dow Jones as an editor and a reporter.

What would being cut out of Hollywood mean for Wang Jianlin? Quite a bit, if a group of lawmakers seeking to limit acquisitions of U.S. cultural icons have their way.

Despite what many might think, the Chinese billionaire has a smart overseas strategy, even if some of Dalian Wanda's biggest purchases have been unprofitable. Wang has been snapping up movie studios and cinema chains around the world -- even adding recliner chairs to some to raise ticket prices -- to effectively create an entertainment oligopoly.

Viewer Pitch
Since buying AMC in 2012, Wanda has been ramping up overseas acquisitions of entertainment assets
Source: Bloomberg

Getting out of China matters. Asia's biggest economy is weathering its worst box-office slump in at least five years, and it deepened in the third quarter as films like the latest installment of Matt Damon's Jason Bourne series failed to attract viewers. That's been taking its toll on Beijing-based Wanda Cinema Line, whose stock is down 44 percent this year.

More Miss Than Hit
Wanda Cinema shares have underperformed the benchmark Shenzhen stock index this year

Since acquiring U.S. cinema group AMC in 2012, Wanda's offshore purchases have come thick and fast, including Hoyts in Australia and Odeon in the U.K. The real game changer will be pulling off Carmike, which is pending antitrust approval. With it, Wang would become North America's biggest theater owner, and a significant price setter.

Wang has made no secret of his desire to own studios as well. Paramount didn't come up trumps but there's loss-making Legendary and more recently an alliance with Sony. Wanda is also in talks to buy Dick Clark Productions, the closely held producer of the Golden Globe Awards, plus there's Sydney-based Ticketek for good measure.

Until now, CFIUS, the watchdog that scotches deals on national security grounds, has largely reserved its scrutiny for military or technology purchases. Clamping down on so-called soft power acquisitions takes things to a whole new level. It would present a challenge not just for Wanda and its own ambitions to stitch up the world's entertainment scene, but for Hollywood as well.

Legendary for one has benefited from Wang's deep pockets and Hoyts is already showing the benefits of new ownership, reporting first-half earnings of $20 million, up from about $7.5 million in the three months to Dec. 31.

Without major cash infusions, Hollywood studios are going to find it very hard to keep churning out the multimillion-dollar blockbusters that draw moviegoers globally. Having a Chinese partner also helps with exposure to a market that should overtake the U.S. in coming years. 

Outside of shopping malls and real estate, Wanda hasn't been in the happiest of places. In August, it shelved a $5.6 billion reorganization of its entertainment assets and it's had to temporarily close a theme park on the mainland. UBS, meanwhile, walked away from a $4.4 billion deal to take Dalian Wanda Commercial Properties private after it became uncomfortable with the structure of the transaction, the Financial Times reported over the weekend.

Wanda also isn't in the same basket as Alibaba, which may be pushing into films but for the most part spends its pennies in Asia.

Perhaps one solution to appease U.S. regulators would be for Wanda to ratchet its headline-making acquisitions back and consider minority investments instead. That would probably still allow for strategic placement of Chinese references in movies.

Whatever the outcome, two things are certain: Movies aren't exactly a cheap business to be in, and cash-rich Wang needs the overseas diversification.

Count on more plot twists to come.

This column does not necessarily reflect the opinion of Bloomberg LP and its owners.

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Nisha Gopalan in Hong Kong at

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Katrina Nicholas at