China has a new richest man, thanks to $1.3 billion from American moviegoers

August 20, 2013
August 20, 2013

A few days ago, the world thought Chinese real estate magnate Wang Jianlin was worth a mere $9 billion, based on Bloomberg Billionaires estimates. Scratch that, though—Bloomberg recounted and discovered that Wang, head of Wanda Group, is now worth at least $14.2 billion, making him China’s richest person, and the 66th richest in the world.

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(The Bloomberg article puts Wang’s net worth at $14.2 billion, also as of Aug. 19; it’s unclear why there’s a discrepancy.)​(Bloomberg)

Where did that $5.2 billion come from? A lot came from the fact that Bloomberg (and its competitor, Forbes) had previously neglected to count the several billion dollars in Wanda Group’s department stores, apparently only counting Wang’s property holdings toward his net worth.

But even if it missed Bloomberg’s tally, that business was already well established. The big thing that Wang Jianlin’s empire has gained this year that it didn’t have last year is income from America’s movie business.

Only in September of 2012 did Wanda spend $2.6 billion to buy AMC, the US’s second-biggest cinema chain. The investment looked a little unwise at the time considering AMC was hemorrhaging hundreds of millions of dollars each year.

However, in the first half of 2013, AMC brought in $1.3 billion, putting it on track to beat the $2.5 billion AMC earned in 2012 ticket sales. Wanda also said that after it instituted an incentive systems and better information management, AMC’s 2012 net profit was more than $50 million.

Was that reason for Wang to gloat? Why, yes, it was. “This explains that Wanda isn’t just capable of going international, it also is capable of managing businesses that Americans failed at” (link in Chinese), he said in his report on Wanda’s first half.

American theaters are a big boon to Wang’s business, and so are his theaters in China. Wanda Cinema 5 Studios made around $320 million in revenue in the first half of 2013, a 63% increase on the same period in 2012. That puts it on target to bring in its goal of $523 million in revenue this year, which would give Wanda as much a 20% share of China’s theater market.

US movie studios are helping with that. Pacific Rim, for example, has so far grossed $103 million in China as of August 18, with the blockbuster Fast & the Furious 6 bringing in $66 million. In fact, China’s proving to be a growth market for US flops like Pacific Rim, which is nipping the heels of Iron Man 3’s $121 million in China, a 2013 record.

The US movie business adds to other foreign investments that are lining Wang’s pockets. He recently invested $10 billion in a British yacht company and a series of luxury hotel and apartment complexes along the Thames in London. Imagine the untold billions that could add to Wang’s net worth when Bloomberg Billionaires adds those to the tally.

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