Dalian Wanda to sell hotels to R&F, up price of tourism projects for Sunac

A sign of Dalian Wanda Group in China glows during an event in Beijing, China.
A sign of Dalian Wanda Group in China glows during an event in Beijing, China.PHOTO: REUTERS

BEIJING (REUTERS) - Dalian Wanda Group will sell 77 hotels to developer R&F Properties instead of to Sunac China, Sunac's chairman said on Wednesday (July 19), in a twist to the second-biggest real estate deal ever in China announced a week ago.

In the initial agreement announced last Monday, Chinese property giant Dalian Wanda said it planned to sell tourism projects and the entire set of hotels in the country to Sunac for US$9.3 billion (S$12.7 billion).

The three companies confirmed the alterations to the deal in a joint announcement on Wednesday, and also said Wanda will now sell 91 per cent of 13 cultural projects to Sunac China for 43.8 billion yuan, up from 29.58 billion yuan (S$5.98 billion).

Sunac has now paid 15 billion yuan to Wanda Commercial for the tourism projects, Dalian Wanda chairman Wang Jianlin said, adding that Sunac would not borrow from Wanda to complete the deal as had been earlier announced.

Sunac Chairman Sun Hongbin said the firm had "ample" cash flow with 90 billion yuan of cash on hand.

Wanda Commercial, the property unit of Dalian Wanda, has 100 billion yuan of cash on hand, and will get 68 billion yuan from the Sunac and R&F deals, Wanda's Mr Wang said.

Mr Wang also added that Wanda Commercial's rent income for 2018 will exceed 33 billion yuan and expects 20 per cent growth year on year of rent income for Wanda Commercial in the next five years.