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Wanda Sports snubbed by Wall Street after downsized IPO

US investors unconvinced on conglomerate's ambitious pivot

Wanda Sports closed 36% lower than its initial offering price after a downsized listing.   © Reuters

NEW YORK -- Wanda Sports Group missed the kick in its Wall Street debut Friday, closing at $5.16 per American depositary share -- below its initial public offering price of $8.

The Nasdaq-listed unit of Chinese conglomerate Dalian Wanda Group raised just $190 million in its IPO, selling fewer shares at a lower price than previously sought, after having already downsized the listing from its original $500 million target.

Wanda Sports, which owns the operator of the Ironman Triathlon and has had partnerships with FIFA and the Chinese Basketball Association, generates revenue from events and media rights as well as other sports-related services. It reported a $9.7 million loss in the first quarter of 2019 on revenue of $275.8 million.

Ultimate parent Wanda Group, a real estate developer-turned-business conglomerate, has in recent years placed an increasing emphasis on its cultural businesses, which became the largest contributor to the group's revenue in 2018 at around a third of the total. Wanda has also been under pressure to unload billions in assets it had acquired over a yearslong buying spree and repay its debt.

In Wanda Sports' prospectus filed with the U.S. Securities and Exchange Commission, the unit said it intended to use the net proceeds from its IPO to repay $200 million in lending. Funds raised Friday fall short of that amount.

Wanda Sports' disappointing market debut followed that of Tencent Holdings-backed livestreaming platform Douyu, which has been trading below its IPO price since going public on the Nasdaq last week, suggesting U.S. investors' growing skepticism about Chinese listings.

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