China’s Dalian Wanda scraps bid for Bandar Malaysia project

KUALA LUMPUR (July 26): Dalian Wanda Group has abandoned its bid for the Bandar Malaysia project just three months after being considered a front runner, the South China Morning Post reported yesterday.

In a report by Singapore’s The Straits Times yesterday, seven Chinese and two Japanese firms were identified as applicants to be the master developers of the multibillion-dollar project. Wanda was not among them.

Back in May, sources told The Straits Times that negotiations with Dalian “to take a central role as master developer have reached an advanced stage and the agreement is awaiting approval from China's financial regulators”.

Prime Minister Najib Razak met with Wanda founder Wang Jianlin on May 13 in the company’s headquarters in Beijing when the former led a delegation to attend China’s Belt and Road Forum.

And before that, the government cancelled its deal with Iskandar Waterfront Holdings and China Railway Engineering Corporation to buy a 60% stake for RM7.4 billion in Bandar Malaysia and work as its master developer under an agreement signed in 2015.

According to the Singapore daily, Malaysian officials acknowledged “that there were preliminary talks with Wanda, but Putrajaya later decided to widen its options by calling for international proposals on how to proceed with the development”.

Bandar Malaysia's request for proposal exercise was open only to Fortune 500 companies with a combined revenue of RM50 billion or more in the past three years.

Wanda is among five Chinese private companies targeted by Beijing’s regulators in a crackdown on overseas acquisitions.

The South China Morning Post reported that Wang last week “vowed to shift his investment focus ‘mainly in China’, following revelations that Chinese regulators had instructed the country’s largest lenders to cut funding for six of the company’s overseas acquisitions”. However, Bandar Malaysia was not among those that lost funding support.

Bandar Malaysia will be developed on the 197ha of the former Sungai Besi air force base and will be the location for the terminus of the Kuala Lumpur-Singapore high-speed rail.  

Wanda declined to comment when contacted by the South China Morning Post yesterday concerning the status of its bid for Bandar Malaysia.