GLOBAL ratings agency Standard & Poor’s (S&P) said it could lower the debt rating on Dalian Wanda Commercial Properties again, after downgrading it for a second time this year Monday, if the once Hong Kong-listed developer does not list on the mainland within the next two years. S&P downgraded the rating on Wanda Commercial, owned by China’s richest man Wang Jianlin, by one notch to “BBB-” Monday, citing rising financial leverage and slower than expected asset disposal at China’s largest commercial developer. Another downgrade will push the rating into “junk” category. Wanda Commercial’s outlook remains “negative,” S&P said, due to uncertainty over a proposed listing on the mainland. Dalian Wanda Group delisted Wanda Commercial from Hong Kong in a US$4.4 billion buyout offer earlier this year, with an aim to re-list it on the mainland, either through a backdoor listing or a public offer, where it hopes to gain better valuations. However, a re-listing has proven more difficult than expected as the mainland’s securities regulator has increased scrutiny due to concerns over the huge valuation gap between domestic and overseas stocks, and amid concern over speculation in shell company shares. Wanda Commercial’s strategy impacted its rating, S&P said. “Wanda has adjusted down its target of opening more than 60 new malls each year to more than 50, and now relies more on the asset-light strategy, but its visible asset disposal has been weak,” S&P director Cindy Huang told a briefing by phone Tuesday. “So its carrying assets in the balance sheet are larger than anticipated and hence increases its leverage position.” But Wanda Commercial’s funding cost is not expected to be greatly affected by the downgrade because it relies more on onshore financing, which is not impacted by the S&P rating, she said. (SD-Agencies) Caption: The company logo of Dalian Wanda Commercial Properties Co. is displayed at a news conference on the company’s annual results in Hong Kong in this file photo. Standard & Poor’s may lower the debt rating on the firm again, after downgrading it for a second time this year Monday, if the once Hong Kong-listed developer does not list on the mainland within the next two years. SD-Agencies | 