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China repeats call for caution on overseas sports, media deals

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China repeats call for caution on overseas sports, media deals

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SHANGHAI (Reuters) – China’s commerce ministry reiterated on Thursday warnings about overseas acquisitions by local firms, especially in sectors such as entertainment and sport, underlining a recent drive to rein in offshore spending by some of the country’s biggest firms. Chinese firms should exercise “prudent” decision making regarding overseas investments in real estate, hotels, film studios, entertainment and sports clubs, a spokesman for the country’s Ministry of Commerce said at a briefing. “We will continue to work with relevant departments to guard against risks of outbound investment, and ensure the healthy and orderly development of investment overseas,” ministry spokesman Gao Feng said, according to a transcript of the event. Gao was responding to a question about real estate giant Dalian Wanda Group, which has recently come under the spotlight over its overseas deals in entertainment and film. Wanda has been very active globally, with deals for U.S. cinema chain AMC Entertainment Holdings Inc <AMC.N>, Hollywood film studio Legendary Entertainment, Odeon & UCI Cinemas and Nordic Cinema Group, as well as a UK luxury yacht maker. It also owns a stake in soccer club Atletico Madrid. China will support companies investing overseas according to market and international rules, especially in ‘Belt and Road’ developments, Gao said, referring to China’s push to increase infrastructure investment along a modern day ‘Silk Road’. Beijing’s crackdown on showy overseas ventures and high-profile empire builders has drawn in several corporations apart from Wanda, such as HNA Group, Anbang Insurance [ANBANG.UL], Fosun International <0656.HK> and Zhejiang Luosen that was behind the purchase of A.C. Milan football club. China’s state planner said earlier this month authorities would continue to monitor the trend of “irrational” overseas investments in real estate, hospitality and film. After rising 44 percent last year, outbound direct investment by Chinese firms fell 45 percent year-on-year in the first half of this year.

(Reporting by Adam Jourdan; Editing by Himani Sarkar)
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