10 Years Of Preparation For 4 Years Sprint Wanda Difficult To List Dreams

Wang Jianlin, chairman of Wanda Group, elaborated on several major events to be promoted in the second half of the year in the 2014 summary of Wanda's first half year. This includes "promoting the listing of major companies". In July 1st, the CSRC issued the announcement of the issuing supervision department's initial public offering audit process and application for enterprises. The announcement showed that 32 enterprises such as Wanda Commercial real estate had submitted pre disclosure materials because they did not comply with the rules, and the financial information in the application documents exceeded the validity period for 3 months and were terminated.

This means that Wanda Commercial real estate has been running for 4 years A share listing plan had to be stranded. Why is Wanda Commercial Real Estate difficult to fulfill the dream of "A share listing"? Where is the "pain spot" behind it? "Third retail sales" recommends a commercial real estate expert, Mr. Bai Wenxi's masterpiece, "the dilemma of Wanda Commercial real estate listing".

The writer is a member of the Federation of commercial real estate Specialized Committee and assistant chairman of the Greater China Shopping Center Alliance. The third retail sale is authorized to publish this article.

　　 [Wanda Commercial real estate listing difficulties]

10 years of preparation and 4 years of sprint, Wanda Commercial real estate A share listing plan ended with a notice issued by the China Securities Regulatory Commission in July 1, 2014. There are speculations that Wanda has acquired two listed companies in the US and Hongkong, and will be backdoor listing in Hongkong or the United States. There are also speculation that Wanda's financial indicators are not good enough, leading to the failure of A share listing. In any case, Wanda Commercial Real Estate submitted its listing application to the SFC in 2010 from the perspective of appearance. With the high price earnings ratio of A shares, abandoning the A share market to overseas, it must have been difficult to ease.

From the public information, Wanda Commercial real estate listed business includes real estate development, shopping mall rental and hotel business three parts, and Wanda cinema, Wanda Department store, big singer KTV and other related formats are not among them. From the financial data released by Wanda Group, the total revenue of commercial real estate in the first half of this year was 66 billion 850 million yuan, an increase of 18% over the same period, including 56 billion 650 million yuan in real estate business, 5 billion yuan in rental income, an increase of 36% over the same period last year, 99.9% rent collection, a total holding of 17 million 996 thousand square meters of property, 1 billion 990 million yuan of hotel business income, 18083 rooms in total, and 3 billion 200 million yuan of other business income. Judging from the income structure of commercial real estate announced by Wanda Group, real estate business accounts for 84.74% of the total income of commercial real estate. Although rental income has increased rapidly, it still accounts for only 7.47%. In view of this, Wanda Commercial real estate is still a developer who mainly relies on real estate business, and is not a "rentals" mainly relying on rental income.

As one of the core of macro-control, listing, merger and reorganization and refinancing of real estate enterprises are all limited industries of A shares for many years. Wanda's attempt to circumvent the intention of the SFC to restrict the real estate development industry has been tried to avoid the listing of commercial real estate business, because in recent years, financial institutions have restricted the housing business in practice, but have not restricted the commercial real estate business. But as a regulator of the capital market regulation, the SFC has not clearly distinguished commercial real estate and residential real estate, nor has there ever been signs of easing the listing of housing companies. Wanda Commercial real estate as a real developer, the road of listing is not smooth is reasonable.

Wanda Commercial Real Estate business model It has also been criticized by the industry. "Cash flow assets" is the core of the success of Wanda real estate, and its own commercial brands such as Wanda Department store, Wanda cinema, big star TKV, hotels, video games are pillars of Wanda Commercial real estate success, and the success of commercial real estate investment and operation has created high priced cash atmosphere and conditions for selling properties such as residential, apartment, The Residence Hotel, office building, golden street, and inner shop. As a common mode of business operation, it is normal for unlisted private enterprises to supplement another business with a business income. However, it is necessary to divide commercial real estate business (including real estate development, shopping mall rental and hotels) to be listed, among which cross subsidy is related to related transactions, while related transactions involve business independence, profitability and sustainability, as well as the transparency of costs and profits. First, it must be clear that two must be traded at fair market prices. According to the data released by Wanda Group, the market rental and hotel business is bound to be a loss (the profit on the surface of the hotel business is difficult to cover the interests of the hotel itself) and the profit is not expected. The self-supporting commercial area with low rental income has expanded rapidly and become a bottomless pit of cash flow. These need to be leveled and made up by the cash flow and profit of the real estate development business, so that Wanda Commercial real estate will become a real estate developer financially. In fact, the sales ratio of Wanda's property is generally over 60%. In view of this, the regulatory authorities hesitate to Wanda Commercial real estate listing is also very easy to understand, sprint for 4 years without a fruit, it seems inevitable.

In addition, related transactions are Wanda Group's various businesses. plate The background color between business independence. The hotel business of Wanda Commercial real estate, even if there is a profit transfer between property leasing and operation, such as lowering rent to make profit on the hotel business report, it is also rotten meat in the pot, and has not surpassed the whole business disk of Wanda Commercial real estate. But Wanda Department store, Wanda cinema, cultural industry (such as big singer KTV, video game, etc.) are all holding their own property inside operation. The adjustment of interests between the plates is inevitable. This adjustment will become a balance between the left and right hands when Wanda Commercial real estate and Wanda cinema are listed. The original motive of Wanda Group to build its own business format brand was originally to create an atmosphere for commercial real estate projects in immature commercial circles. But with the rapid expansion of Wanda Group, these self owned brands have also become a giant chain of their own, becoming an increasingly large financial black hole that swallows cash flow. In order to plug these financial black holes, Wanda Group must, on the one hand, reduce the cash outflow caused by operating losses by raising the level of operation. On the other hand, it will enable some of its own brands to go on the market as soon as possible through the transfer of internal interests, so as to make up for the cash flow that can't be spent. But these private brands are operating in the property of Wanda, and the transfer of profits between the business segments is a natural dilemma.

Wanda Group chose to allow Wanda cinema to go on the market instead of choosing Wanda Department stores with larger business scale, because the latter is too large. If we want to make financial adjustments, we will have a greater negative impact on Wanda Commercial real estate. The result of this choice is bound to be Wanda Department's commitment to the investment mission of Wanda Commercial real estate at the same time, becoming the "cost sink" of the cost and loss to be listed on the business segment. It is no wonder that Wanda Department has difficulty in improving its performance at the operational level. Even if it changes frequently, it will be difficult to make profits in the future. Wanda Group finally chose to let Wanda Commercial Real Estate abandon A shares to overseas listing, so that Wanda cinema continue to sprint A shares should be wise. Because of the smaller volume of the latter, its financial adjustment has little negative impact on Wanda Commercial real estate. The Wanda Group's left and right hands have little difficulty in fighting each other, making it easy to realize the book profit of Wanda cinema operation, and realize A share listing at a low cost to enjoy the rolling cash flow brought by high price earnings ratio. The supervision of overseas capital markets represented by Hongkong and the United States is mainly concentrated on information disclosure. The core of the regulation is to enable investors to self judge and self choose under the premise of mastering real information, while the regulatory requirements for profitability and related transactions are low. Therefore, Wanda Commercial real estate, which is doubtful about profitability and related transactions, is more suitable for overseas listing. Wanda Group has bought two listed companies in Hongkong and the United States respectively, showing signs of backdoor listing. From the first half of this year's work report, Wanda Group also has plans to promote overseas listing of major companies. In order to avoid questioning the profitability, Wanda Commercial real estate will highlight its growth and win the pursuit of capital market with growth. This is also emphasized in Wang Jianlin's speech of Wanda Group in the first half of 2014.

From this point of view, Wanda Group The technical roadmap of various business sectors has been quite clear: major businesses such as Wanda Commercial real estate will be listed overseas, Wanda cinema is listed on A shares, and only two overseas listed companies bought will be loaded into other business segments at the right time, and the cost and loss of each business sector will be reduced to larger volume Wanda Department stores. Under this technology roadmap, Wanda Group is also actively exploring other financing channels. In the first half of this year, Wanda Commercial Real Estate successfully issued $600 million 10 year unsecured bonds overseas. It is not easy for the Wanda Group to make a difference in the past 10 years to clarify this listed technology roadmap. From the current situation, it should be the best choice: to avoid the regulatory difficulties of profitability and related transactions by listing overseas, and to test the market response by issuing bonds before listing overseas, without disclosing too much company information and obtaining a growth premium at a high growth rate to win a higher price earnings ratio for more financing. However, although the overseas capital market has no requirement for financial performance at the time of listing, it emphasizes more on profitability by valuing the company, which will be the weakness of Wanda Commercial real estate listing overseas.

In the first half of 2014, Wang Jianlin repeatedly stressed that Wanda Commercial real estate was not short of money, and the listing was just to make the company more transparent. However, in the past, commercial giants such as Simon, Xi Tian, Kade, Hang Lung and Huarun are not giant players who are playing the capital market. Looking back, they have supported the growth of Wanda Group by relying on property mortgage financing and property sales refunds, but this is a sharp rise in property prices driven by the rapid growth of China's economy and the rapid expansion of the real estate market. With the rapid growth of China's economic growth and the rapid expansion of the volume of Wanda Group, it seems unreasonable that an enterprise that wants to maintain a high growth and forge ahead without opening up capital market channels does not lack money. From Wanda's own statement, Wang Jianlin made the 11 mention of listing in the first half of 2014, and set up a listed working group headed by Ding Ben Xi, the 16 time to mention finance, and to set up a financial holding group in the three quarter and plan to invest in other financial enterprises.