Liu Haibo (seated L) and Wang Jianlin (third from L) meeting Guiyang officials in 2020 (Image: Wanda Group)
China’s Dalian Wanda Group is facing a new challenge this week as a senior vice president with the country’s largest commercial developer has been taken away by police in what is said to be a corruption case.
Sources at Wanda Group informed Mingtiandi that Liu Haibo, who oversees the company’s investment division, was arrested in a case linked to the company’s internal anti-corruption efforts, confirming news first reported in local media outlet ThePaper.cn. In addition to Liu, multiple other Wanda team members are also said to have been detained, although no names have been made public.
The removal of Liu, who has ascended through a series of management roles since joining the mall specialist in 2010, is the latest challenge for tycoon Wang Jianlin’s Dalian Wanda, which recently has been selling down assets as its plan for a Hong Kong IPO has faced a series of delays.
Just over two weeks ago Dalian Wanda Group, agreed to sell a 49 percent stake in its investment division, where Liu had been employed, for RMB 2.27 billion ($320 million), as it rushed to repay a $400 million offshore bond which matured on 30 July. Bondholders reported receiving payment on the obligation on time, following Wanda’s asset sale.
Company Veteran Ousted
Liu, joined Dalian Wanda as an assistant to the president in 2010, before later being promoted to executive deputy general manager of the company’s development division.
Liu Haibo had been at Wanda since 2010 (Image: Wanda Group)
From there the 1991 graduate of the Beijing University of Aeronautics and Astronautics (now Beihang University) moved up to general manager of Wanda’s development division before later being promoted to regional general manager, chief vice president and senior vice president of the group, according to Wanda corporate statements.
Liu’s last public appearance had been on 1 August, when he attended a working meeting together with Wanda Group chairman Wang Jianlin with the city government of Datong in China’s Shanxi province. On 25 July, Liu had accompanied Wang for a meeting with city leaders in Luoyang, Henan province, where Wanda has a tourism project.
Wang Jianlin, who served in China’s People’s Liberation for 17 years before starting his business career, is noted for his military-style discipline. In December 2021, Wanda Commercial Management vice president Zhu Zhanbei was suspected of corruption by the company and was detained by Shanghai police, according to a report in Yicai.com, and two Wanda executives in Beijing were arrested in 2018.
Facing IPO Deadline
Wanda’s internal turmoil has surfaced as the company is continues to face uncertainty as it is caught between China’s broader economic malaise and impending debt obligations.
Fitch Ratings noted last week that Wanda Commercial had failed to make payment on interest on a $400 million offshore bond when it came due on 20 July, although the company did avoid formal default by making good on the obligation within the 10-day grace period and paying off the principal on the notes when it came due on 31 July.
The company also made a coupon payment on 31 July on at $600 million bond maturing in 2024.
Wanda Commercial has assured investors that it has sufficient funds to make good on any near-term bond payments, however, Fitch said that it, “believes the company will continue to face liquidity challenges as there is no clarity on the refinancing plans of several onshore and offshore bonds maturing in the next six months.”
On 28 June Wanda made a fourth application for a Hong Kong initial public offering for its Zhuhai Wanda Commercial Management, after three earlier attempts had failed to win approval.
The company, which has 472 mainland malls under management with a gross floor area of 65.6 million square metres (706.1 million square feet), had once been estimated to be in line for a $3 billion return to the Hong Kong exchange, after Wang led a pricey privatisation in 2016, however, the company has since struggled with regulatory hurdles and economic challenges.
If a Zhuhai Wanda Commercial Management IPO is not secured this year, Wanda Commercial and Dalian Wanda Group will owe pre-IPO investors RMB 40 billion ($5.5 billion), according to an earlier estimate by credit agency S&P Global Ratings.
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