China's Wanda to Buy AMC Theater Chain for $2.6 Bil.

Dalian Wanda Group agreed to buy AMC Entertainment Holdings Inc. (AMC) for $2.6 billion including debt, according to statement by the group. The deal will create the world’s biggest chain of cinemas.

The Wanda Group is controlled by Wang Jianlin, a real-estate developer recently recognized as China’s wealthiest person with a fortune estimated at $7.3 billion. Wang plans to pour another $500 million into AMC to cut its debt, upgrade some theaters to Imax and 3D and add more dining options and bars. AMC is already the second biggest theater chain in the US. Wanda’s investment will eventually turn it into the top chain in the US as well as in the world.

“We have much to learn from them,” Wang told Bloomberg in a phone interview Sunday. “However, we would like to say we can learn from each other. He expressed the view that in some respects the China’s cinema market is more advanced.

The Wanda group operates a chain of 86 theaters across China, and owns various hotels and department stores. Together with AMC’s 346 locations, the new combination would be bigger than Regal Entertainment Group which had $2.7 billion in sales in 20111. AMC had about $2.5 billion for the year ending on March 31, 2011.

Wang hopes AMC’s assets can help his group tap China’s surging box office which grew 35% last year to $2 billion. That put China behind the US and Japan, but during the first quarter China passed Japan on a trailing 12-month basis to become the world’s second largest movie market.