Wanda Group's surprising disposal of US$9.3 billion worth of assets to Sunac China Holdings has raised plenty of unanswered questions among China's business circles after official explanations from the two companies failed to fully convince a sceptical market.
At the centre of the mystery is the enormous costto Wanda of its divestment, with chairman Wang Jianlin's only official explanation being to "reduce debt" and adopt an "asset-light" business model. Previously he has not given any indication of the intended asset sale.
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Just a week ago, Wang was guest of honour at a banquet hosted by Yunnan province's Party Secretary when the billionaire revealed a 32 billion yuan (US$4.7 billion)plan to create a city-size project combining health care services, holiday resort and business facilities. And at the end of June, Wang announced the opening of the nearly 40 billion yuan Wanda City development in northeast Harbin.
Now, these two projects are among the 13 that Wang offloaded for 29.6 billion yuan – despite Wanda's total investment of 430 billion yuan – with Sunac paying another 33.6 billion yuan for 76 Wanda hotels.
The Sunac deal is even more surprising given that Wang had pinned hopes for his company's diversification from property development on the Wanda Cities projects.