A missing tycoon's links to China's troubled Dalian Wanda

Dalian Wanda, the Chinese conglomerate that owns the AMC movie theatre chain and nurtures Hollywood ambitions, has sometimes turned to the secretive business network of a politically connected Chinese billionaire in times of need.

Now both Wanda and that billionaire, Xiao Jianhua, are under official pressure in China — and one Wanda insider says that may not be a coincidence.

Xiao was escorted out of a Hong Kong hotel in January in the middle of the night in a wheelchair by unidentified men. He is now believed to be across the border in mainland China helping the authorities with investigations into the financial industry. His legal status is unclear: China’s government has not made any announcement about whether he is in custody.

Half a year after Xiao’s disappearance, Wanda is selling off large portions of its empire of malls, hotels and amusement parks, as big Chinese companies are under increasing pressure from regulators to shed debt.

Chinese authorities have not discussed Xiao’s situation publicly. But Tony Saich, a professor at the Kennedy School of Government at Harvard University and a director of Wanda’s AMC Entertainment arm, said  Xiao’s work with the authorities and Wanda’s problems might be connected.

 “I think virtually all these things that are unfolding now are possibly related to Xiao’s trip across the border,” Saich said.

Saich has played host to Wanda’s chairman, Wang Jianlin, at Harvard and knows Xiao because of his donations to the university. Saich said that Xiao might be laying out for government regulators the complex and interlocking web of debts and shareholding ties among many companies that could pose a danger to China’s financial stability. In the months ahead of an important Communist Party meeting this autumn, the Chinese leadership — led by Xi Jinping, China’s president — has placed an even bigger emphasis on stability, leaving an impression that the government is tightening its grip.

“My sense is this has gone up the system to Xi and they are just staggered by what is going on,” Saich added.’

Neither Wanda nor Xiao has ever publicly discussed whether they have a relationship. But a review of documents indicates that business associates of Xiao were involved both in the process leading up to Wanda’s 2014 initial public offering in Hong Kong and its privatisation less than two years later, according to numerous corporate filings in China and Hong Kong.

It is not clear whether Wanda actively sought his help or whether Xiao’s connections in the Chinese business world are so extensive that they could be difficult to avoid. Xiao, 45, did not respond to a request for comment. A spokesman for Wanda would not comment when asked about ties between Mr. Xiao and the company.