China’s Dalian Wanda buys World Triathlon from Providence

WTC, which has been held by Providence since 2008, has a 91% market share in the long-distance triathlon market. The company owns five triathlon brands in total and operates at last 250 events per year, including more than 130 Ironman races with over 230,000 competitors. Gross revenue and net profit have both seen compound annual growth of 40% for four consecutive years.

The WTC management team will remain in place following Wanda's acquisition. According to a statement released by the Chinese company, triathlon participation in China is expected to grow in line with the expansion of the country's middle class. Wanda also expects to see considerable demand from prospective host cities. Triathlons attract competitors and supporters, which means greater demand for hotel rooms and other local services.

Wanda has built up a portfolio of sports-related assets and claims the addition of WTC will make it the largest sports company in the world in terms of scale. The company wants to have a foothold in the entire value chain, including event organizing, athlete representation, event marketing and rebroadcasting.

In February, Wanda agreed to buy sports marketing firm Infront Sports & Media from European PE firm Bridgepoint for EUR1.05 billion ($1.2 billion). It also holds a 20% stake in Spanish football club Athletico Madrid. On the domestic front, Wanda's activities include participating in a funding round for sports channel LeTV Sports.

"Our acquisitions in the sports industry were by no means a spur of the moment," Wang Jianlin, Wanda's chairman, said at the company's semi-annual meeting in July. "Neither are we the upstart going on a buying spree without much thought as some might perceive us to be. We have our rationale for such acquisitions and the sport companies that we acquire must be able to take root in China."

He noted that the US has a population of 300 million and a sports industry that generates $500 billion per year. In China, annual revenues stand at just $10 billion, but the government wants the sports industry to be worth RMB5 trillion ($780 billion) by 2025 and has rolled out policy initiatives to support this effort.

Already China's largest commercial property developer, Wanda wants to become a service-oriented company covering four core industries: commercial property, culture, financial services and e-commerce. The cultural industry portfolio generated RMB34.1 billion in revenue last year. A holding company will be set up this year for Wanda's sport-related assets. It will be one of four in the cultural industry group, sitting alongside tourism, children's entertainment and media.

The company's media holdings span film production, distribution and screening. Wanda has also gone overseas in this area, adding to domestic assets that include the largest local movie theater chain and a nascent movie studio complex. It bought US-based AMC Entertainment from several PE firms for $2.6 billion in 2012 and recently picked up Australia's Hoyts Group from Pacific Equity Partners (PEP).

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• Topics
• Greater China
• Consumer
• Exits
• North America
• China
• USA
• Providence Equity Partners
• Exit
• Trade sale
• Consumer
• Dalian Wanda Group