Wanda Film financing nearly 3 billion, Bona will go public, reveal what secrets

1905 movie network feature On the eve of the New Year’s Eve, following the 2021 Spring Festival, Wanda Film has once again become the focus of discussion.On the evening of November 9, Wanda announced that the total amount of proceeds raised reached 2.93 billion yuan, creating the largest financing record in the history of class A share film and television companies. The capital of all parties used real money, indicating optimism about the future development of China’s film industry. For Wanda Film, this capitalgoldalsoLike a "timely rain". 

"Wanda’s fixed increase is something that the industry is very concerned about. Affected by the pandemic, the company suffered serious losses in the first half of the year, and this 3 billion yuan is very important to enrich the company’s cash flow," a Beijing-based brokerage analyst said in an interview with the media. "With the resumption of cinema work, the pace of the overall recovery of the industry from the third quarter is also accelerating."

Not long ago, from the US stock delisting of Bona film, after more than three years of long wait, the class A shares IPO plan finally passed the review. In the future, the company will be listed in the Shenzhen Stock Exchange small and medium-sized sector.

The double happiness of the top film and television companies also seems to suggest that the development of China’s film market will accelerate its recovery and move in a better direction in the future. With the support of favorable policies such as increasing attendance, China’s film box office is expected to continue to maintain the momentum of being the world’s largest.

Wanda Film’s "Timely Rain"

"What happened to Wanda Film?"On November 10, some netizens who followed the film and television sector of the stock market found that after the opening of the day, Wanda Film’s share price rose by more than 10%. By the end of the day, the company’s share price had risen by 7.68%, closing at 18.51 yuan per share.

The public’s doubts were quickly solved, and the answer emerged.It turned out that on the evening of November 9, Wanda Film released the "Non-public offering of class A share stock issuance report and listing announcement". Announced the non-public offering of 196 million shares, the issue price was 14.94 yuan/share, and the net proceeds were 2.896 billion yuan. This is the largest refinancing of class A share film and television company, and the proceeds raised will be used to build new cinema projects, replenish working capital and repay loans.

Wanda Film received a total of 8 investors for the final placement. Among them, Shanghai Gao Yi Asset Management Partnership (Limited Partnership) was allocated 107 million shares, with an allocation amount of nearly 1.60 billion yuan. According to Qichacha data, Backed by Tencent became the largest shareholder of the company with a capital ratio of 64.59%.

After the completion of the issue, Wanda Film’s top ten shareholders held shares, in addition to Wanda investment, Hangzhou Zhenxi, invested by Alibaba, and Shanghai Gao Yi, backed by Tencent investment, became the second and third largest shareholders respectively.

In the context of the film and television industry pressing the pause button for nearly half a year, where does the confidence in this investment come from?There is no doubt that the rapid recovery ability of China’s film industry has become the biggest driving force. At 0:00 on October 15, the 85th day after the orderly resumption of work in cinemas across the country, the cumulative box office of China’s film box office market in 2020 reached 12.95 billion yuan (1.93 billion US dollars). This box office result also allowed China to officially surpass North America and become the world’s largest ticket warehouse for the first time in history.

Wanda Film’s third-quarter earnings report also pointed out that with the full resumption of work in its domestic theaters, the company’s third-quarter performance has improved, and the overall market share has also increased significantly compared with last year. It is expected that the national box office and the company’s various operating businesses will return to normal levels in the fourth quarter.

According to public data, as of September 30, 2020, Wanda Film had opened 614 directly-operated theaters with a total of 5,438 screens. Since the resumption of production at the end of July, Wanda Film’s box office market share has increased significantly to 14% -15% compared with last year, ranking first in China for 11 consecutive years.

"Since the resumption of cinemas, the return of movie viewing enthusiasm has exceeded expectations. We are optimistic about the long-term stable growth of the Chinese film market. The company expects to return to normal year-on-year operations in the fourth quarter, reversing the impact of the epidemic on the company’s operations," Wanda Film board secretary Zeng Wang Huiwu said at the company’s investor reception day.

In the Spring Festival of 2021, Wanda Film’s "Detective Chinatown 3" is expected to win the box office championship. Previously, the total box office of the two works in the series has reached 4.215 billion.

According to the company’s 2021-2022 film list released on September 21, there will be 18 cinema movies in the future, including "Detective Chinatown 3", "Dragon Hunting 2" and "Manslaughter 2". These movies are divided into six categories: Super IP, Time Melody, Suspense Adventure, and Science Fiction World.

So far, eight blockbusters have been set for the 2021 Spring Festival, which is selling well. This also guarantees the revenue of major theaters during the Spring Festival.The two-way benefits from upstream production to downstream cinemas have made Wanda Film’s advantages in the layout of the whole industry chain appear. If the policy of further improving the attendance rate during important schedules can continue, then the film industry will create new glories just around the corner.

Bona film dream class A share

Before Wanda Film released its huge financing announcement, Bona Film successfully attended the meeting and became the focus of attention in the industry."I askedWang Changtian, also askedWang Zhonglei, ask them if they think the gap between Bona and Huayi and Light can really be more than ten times? "Chairperson and founder of Bona Picturesin winterHe has repeatedly lamented in public that the company’s value is seriously undervalued by the market.

In 2010, Bona Film became the first Chinese film company to go public in the United States. However, it is difficult to meet confidants in other countries. The company’s share price fell below the issue price on the first day of listing, and its market value was only 6 billion yuan at its highest. In 2015, Bona Film completed the privatization of US stocks. In May 2017, the company entered the mainland listing counseling period.After more than three years of waiting, the company successfully passed the audit of the Issuance Examination Committee in early November 2020, and will be officially listed in the small and medium-sized sector of the Shenzhen Stock Exchange in the future.

This is also the first film and television company to successfully land on class A share after Jinyi Film and Television went public in October 2017, except for Mango Super Media’s backdoor listing in 2018. As a major player in the main theme, Bona Film’s excellent performance in the cinema market in recent years has become one of the important reasons for successfully passing the review.

Since its success in 2014, Bona Pictures’ main theme films, such as, and, have achieved a double harvest at the box office.

According to the prospectus, Bona Pictures achieved operating income of 3.116 billion yuan in 2019, an increase of 12% compared with 2.784 billion yuan in 2018; realized net profit of 315 million yuan, an increase of 19% compared with 264 million yuan in 2018.

In the first half of 2020, Bona Film achieved an operating income of 755 million yuan and a net profit of 2680.06 million yuan, mainly due to some online distribution and copyright sales. In the context of the film industry pressing the pause button, this achievement is not easy.

In the prospectus of Bona Pictures, the company’s competitive advantages are mainly classified into three points, the advantages of the layout of the whole industry chain, the advantages of the commercialization of the main theme film and the advantages of the integration of resources in the film and television industry. In terms of the layout of the whole industry chain, in early 2019, Bona received the first batch of cinema licenses after the promulgation of the new policy of cinema in December 2018, following the film distribution license and the film production license (single film).

Among the top ten natural person shareholders, in addition to Yu Dong, well-known filmmakers such as Zhang Hanyu, Huang Xiaoming, Zhang Ziyi, and Han Han are among them. In the future, the final chapter of the company’s action trilogy has been set for the 2021 Spring Festival. Anti-epidemic works with the theme of resisting the United States and assisting North Korea, and "Nameless", which describes the story of the Communist Party of China’s underground party espionage, are also expected to be released in 2021.

Although the listing of Bona Film is only a case of many internal and external factors, it is also a positive signal for Chinese film companies. The success of Wanda Film’s huge financing is also a manifestation of the confidence of the capital markets in the future development of the industry. Whether it is policy level or capital, the future of China’s film industry can be expected.