Chinese Conglomerate Wanda Profits From Redditors’ AMC Pump

At the start of 2021, the investing world was enthralled with the war between retail and institutional investors. Cinema chain AMC Entertainment Holdings (AMC) saw its stock price rise over 800% respectively as Redditors on WallStreetBets rallied together to overthrow institutional short sellers. 

In the Far East, Chinese property-to-entertainment conglomerate Dalian Wanda Group (Wanda) profited from the war, which provided an exit opportunity for the pandemic-stricken business.

On Sunday, Wanda – the largest shareholder in AMC – disclosed that it cut its AMC stake from 6.8% to just 0.002%. Analysts believe Wanda sold 30.5 million AMC shares between 13 May and 18 May at around USD 14 per share, netting USD 426.9 million.

Wanda had bought AMC in May 2012 for USD 2.6 billion in cash and debt, listed the company in 2013 at USD 18 a share, and began trimming its position since 2018. Bloomberg estimated it has gained USD 675 million including dividends since its 2012 investment.

Since 2017, and under orders from Beijing, Wanda has been selling off overseas assets including properties worldwide and a stake in football club Atlético Madrid to reduce debt. Despite the divestments, it is still sitting on debts amounting to CNY 362 billion (USD 56 billion).   

Wanda’s founder Wang Jianlin, a former army man, was once Asia’s richest person in 2015 with a net worth of around USD 46 billion, according to Bloomberg. It now pegs his fortune at USD 9.2 billion.