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Wanda Commercial Tells Investors Will Repay $240M Dec. 29 Notes on Time; In Talks With JD.com, Tencent for Investment in Planned Fund With CNY 90B Assets

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Dalian Wanda Commercial Management Co. Ltd., or Wanda Commercial, has told certain investors that it plans to repay its outstanding $240 million 7.25% notes due Dec. 29 on time, according to two sources briefed on the plan by the company.

The originally $600 million 7.25% notes were extended by 11 months to Dec. 29, 2024 through a consent solicitation. Wanda has made three amortization payments totaling $360 million, as reported.

Separately, the company is planning to set up a fund using 70 to 80 Wanda Plazas, which will have an asset value of around CNY 90 billion ($12.44 billion). As part of that process, Wanda is currently in talks with JD.com and Tencent Holdings about potential equity investments into the fund. The transaction would likely take place through an exchange of JD.com and Tencent Holdings’ owned share capital in Wanda Commercial into equity rights in the new fund, said the first source and a third source briefed by the company said.

Both JD.com and Tencent are existing strategic investors of Wanda Commercial. Tencent led an investor consortium, which included Suning, JD.com and Sunac China, to collectively invest CNY 34 billion in Wanda Commercial in January 2018, to acquire an around 14% stake from strategic investors in Wanda Commercial, according to the onshore news outlet Sina Finance.

The discussions on the fund are still preliminary and subject to changes, the first and third sources said.

Wanda is also working on asset disposals and it is mostly in talks with insurance companies to potentially sell its Wanda Plazas in first and second tier cities to raise cash, the first and third sources added.

The company’s further offshore maturities are the $400 million 11% notes due January 2025 and $400 million 11% notes due February 2026.

The company’s offshore notes are half to 1.5 points up across the curve today, Nov. 12, with its $240 million 7.25% notes due Dec. 29 indicated around 95/ 96 and its $400 million 11% notes due January 2025 indicated around 85.5/ 87, according to two buysiders.

Wanda did not immediately respond to requests for comment.