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.

When it comes to his attempts to dominate Hollywood, Chinese billionaire Wang Jianlin has been quite vocal about U.S. protectionism. Perhaps he should direct some of that energy elsewhere.

Last week, as Wang was making waves at Davos, his domestic rivals were getting cozy with a studio he'd previously set his sights on. Shanghai Film Group and Huahua Media struck a deal to throw Viacom Inc.'s Paramount Pictures Corp. a much-needed lifeline. The tie-up doesn't involve a sale but it does solve a long-term funding problem for Paramount, plus gives it increased access to viewers in China. Wang's Dalian Wanda Group Co. had been seeking to buy the outfit last year.

Hollywood is becoming increasingly dependent on foreign capital, especially from China. Tencent Holdings Ltd. is looking to bulk up, while Alibaba Group Holding Ltd. has a stake in Steven Spielberg's production company Amblin Partners.

Decisively Developer
Even as it bulks up in entertainment, Dalian Wanda remains largely a real estate play
Source: Dalian Wanda Group
Note: Wanda's real-estate unit was delisted in Hong Kong last year. The culture group includes entertainment assets such as movie theaters, while internet technology largely refers to Wanda's e-commerce platform.

For Wang, those crowds aren't welcome, especially at a time Wanda is seeking to diversify away from its core business of real estate.

Hospitals are another area he's looking at, but there again, Wang isn't alone. Everyone from Western private equity firms to other developers from the mainland see an opportunity in China's aging population and rapid urbanization, and valuations are rising.

Good Medicine
Private-equity investment in China's healthcare sector rocketed last year
Source: Bloomberg

Wang's foray into e-commerce through ffan.com hasn't been all smooth sailing, either. Search giant Baidu Inc. and Tencent dropped out of the venture last year and Wang's now hoping 2018 might be the year the site turns a profit.

One area that has been a winner -- managing hotels and shopping malls in Asia's biggest economy. Despite the popularity of buying things online, shopping centers, when they have the right mix of food and entertainment, are still hugely popular, and Wanda gets it right. Analysts at Citigroup Inc. forecast last July that Wanda's real-estate business, which has since been delisted in Hong Kong, would become the world's top landlord by rent collection, eclipsing Simon Property Group Inc. in the U.S. In an address to shareholders published earlier this month, Wang said that while revenue from real-estate development decreased 13.9 percent year-on-year, Dalian Wanda Commercial Properties Co. achieved 19.6 billion yuan ($2.85 billion) in rent receipts, up 29.6 percent.

But, back to Hollywood, where no amount of cinema screens can make up for controlling a big studio with box-office heft. Wanda, which owns Legendary Pictures Inc., was the largest investor in The Great Wall, starring Matt Damon, the most expensive Hollywood-Chinese collaboration ever. Ticket takings, however, have been disappointing in China and aren't expected to be much better when the film opens in America next month.

With pressure every which way outside of real estate, perhaps Wang would serve investors better by focusing on what he does best. Los Angeles isn't called the city of broken dreams for no reason.

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

  1. Wanda currently operates 1,352 movie theaters worldwide with 14,347 screens, giving it a share of about 12 percent of the global box office market. It aims to increase that to 20 percent by 2020.

To contact the author of this story:
Nisha Gopalan in Hong Kong at ngopalan3@bloomberg.net

To contact the editor responsible for this story:
Katrina Nicholas at knicholas2@bloomberg.net