China Billionaire Eyes Bigger Chunk of Global Movie Market
A $2.6 billion acquisition of U.S. movie theater chain AMC seems to be just the tip of the iceberg when it comes to the expansion of China's Dalian Wanda Group, controlled by the country's second richest man.
Wanda Chairman Wang Jianlin told CNBC that the conglomerate's next goal is to have 20 percent market share of the global movie industry by 2020.
"The Chinese market has been growing rapidly, but China alone won't be enough to help us achieve such a goal as China could account for 15 percent in the best case," Wang said on the sidelines of the China Entrepreneur Club's Annual Summit of Green Companies in Kunming, located in the country's southwestern Yunnan province.
"We have to conduct more M&As (mergers and acquisitions) to achieve the target," he said.
Wanda, which also has interests in property, TV and theme parks, is now looking into cinema businesses in Europe, Australia and Japan, Wang added.
The group's purchase of AMC Entertainment last September made it the world's largest theatre owner - combining Wanda's 94 theatres in China with AMC's 338 theatres situated across North America. The move was also the largest overseas acquisition by a privately held Chinese company.
Media reports last month that Wanda was interested in buying UK-based chains Odeon & UCI Cinema Holdings and Vue Entertainment have fueled the M&A talk.
Wang says the "cultural industry" will become the group's most important business and he expects the sector as a whole to see revenue hit nearly $7 billion by 2016 and about $13 billion by 2020.
"[That would] make us about number 7 or 8 in size in the world," Wang said. "Becoming top 10 in the world is our goal."
In 2012, China surpassed Japan to become the largest international market for Hollywood movies, with box office sales growing 36 percent compared to the previous year, according to the Motion Picture Association of America.
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While global expansion is important, Wang added that investing in China would remain key for the group, which is set to invest $5 billion to build the "world's biggest" film and TV industry complex in a Chinese coastal city. He said the details would be announced by mid-year.
"We've signed partner agreements with four of the world's top five movie companies. They partner with us and film their movies in China, while we also make investment in movies they produce," Wang said. "Over the next two to three years, we will have relatively big investments into the content industry."
- By CNBC.com's Rajeshni Naidu-Ghelani; Follow her on Twitter @RajeshniNaidu