June 22 08:26
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- Shares of Wanda, Fosun Plunge, after Regulator Asks Banks to Assess Credit Risks Exposed to Acquisitive Firms, Sources Say
Shares of the listed subsidiaries of Chinese companies known for their overseas acquisition sprees plunged Thursday, after the banking regulator recently asked lenders to conduct internal assessments of their credit-risk exposure to acquisitive companies, sources told Caixin.
Shenzhen-listed shares of Wanda Film Holding Co. fell more than 9% in early trading on Thursday, before its trading was halted. Wanda Film, a unit of Dalian Wanda Group, a Chinese conglomerate which acquired Hollywood movie maker Legendary Entertainment for US$3.5 billion last year and AMC movie theatres in 2012.
Hong Kong-listed Fosun International Ltd. fell as much as 9.6% in the afternoon session on Thursday. It is a unit of Fosun Group which has snapped up more than $15 billion in overseas assets since 2010.
Sources say some of those banks, following their internal checks, have in recent days been offloading bonds issued by Wanda and Fosun. The sharp decline in bond prices has spread to the stock market, leading to sharp fall in share prices, they say.