Wanda eyes Spanish club: reports

Ownership of Atlético Madrid will enhance profile of property group as it prepares for IPO

Commercial property developer Dalian Wanda Group is reportedly in cooperation talks with El Atlético de Madrid, a leading soccer club in Spain, as it prepares for an IPO in the Hong Kong market.

Wanda's interest in the defending champions of the Spanish League was widely reported in the Chinese media on Tuesday, citing a report in Marca, an influential Spanish daily newspaper.

Fueling the expectation is the fact that visiting Spanish Prime Minister Mariano Rajoy met with Wanda Group Chairman Wang Jianlin on September 26 at the Spanish Embassy in Beijing.

A Wanda spokesman did not immediately respond to a request for confirmation on Tuesday. However, the company has previously denied a number of rumors about its investment in soccer clubs, such as one in Southampton Football Club of Britain, which the company refuted on January 20.

Another rumor about an investment in the Club of Rome in Italy in November 2013 turned out to be false.

However, Wanda Group has begun to expand its investments in Europe in property as well as other sectors.

In June this year, it purchased the 28-storey Edificio Espana, once the tallest building in Spain and a central landmark in the Spanish capital Madrid, for 265 million euros ($334 million).

It also announced a $1.57 billion investment in Britain that included the acquisition of Sunseeker, Britain's largest luxury yacht maker by sales, on June 19, 2013.

Wang is one of China's richest men, according to the Forbes rich list.

Experts say these purchases resemble the multi-billion-dollar shopping spree of China's leading e-commerce company Alibaba Group, which acquired a number of companies, including partial ownership of a domestic soccer club, en route to the world's largest IPO at the New York Stock Exchange on September 19, raising over $21 billion.

Wanda plans an up to $6 billion Hong Kong IPO of its Dalian Wanda Commercial Properties Co and list before the end of the year, Reuters reported on September 5.

Analysts say a shinning portfolio of overseas investments is one of the three highlights of Wanda's 800-page prospectus. The other two attractions are the company's O2O (online to off-line) business and property operation.

Li Daxiao, director of the Shenzhen-based Yingda Securities Institute, told the Global Times Tuesday that wooing investors could be an important but not the only reason behind Wanda's interest in buying a soccer club.

"Owning a soccer club could boost Wanda's brand value and serve as a good platform to raise visibility among consumers. Soccer is also Wang's personal hobby," Li said.

Wang owned the Dalian Wanda Soccer Club from 1994 to 1999, which was the most glorious period for the club with four championships. But Wang withdrew in 2000 due to concerns such as corruption that was plaguing the soccer industry in China.

An industry insider surnamed Lu said El Atlético de Madrid is a "desirable" asset to have.

"It is not as famous and expensive as Real Madrid and Barcelona, the two teams with big following among Chinese soccer fans. But it is a team with huge potential. Besides winning the championship, the team has also seen as a cradle of talents, nurturing echelons of youth into stardom," Lu told the Global Times on Tuesday.

"Owning the banner of El Atlético would be like investing in an underpriced, potent stock - it will produce many benefits in the days ahead," said Lu.

Zhao Zijian, a soccer fan in Beijing, told the Global Times that he will shift more attention to El Atlético if the Wanda deal goes ahead.

In terms of how the purchase would contribute to Wanda's business overseas, Zhao believes owning the soccer club, no matter wholly or partially, would be an ideal business strategy for someone like Wang, who is buying up a lot of stuff but perhaps does not enjoy as much publicity overseas.

"In the future, Wang could just tell people that he is the boss of El Atlético, and there won't be a better self-introduction," Zhao said, referring to the huge popularity of the sport in Europe.