(Yicai Global) Nov. 27 -- Wanda Film Holding has again cut the price it plans to pay to acquire affiliate Wanda Media as the buyer's share price continues to fall.

The prospective buyer still plans to buy a 96.8 percent stake in Wanda Media, but has cut the target's valuation to CNY10.7 billion (USD1.5 billion) from CNY11.6 billion, it said today in response to an inquiry from the Shenzhen Stock Exchange. Plans for the merger began in May 2016, when Wanda Film valued the target at CNY37.2 billion.

The new rate is based on a July 31 evaluation of the target, rather than the March 31 assessment used in the last proposal.

It works out at CNY33.2 (USD4.8) a share, more than 50 percent more than Wanda Film's [SHE:002739] own share price, and the balance will be settled completely through the issuance of new shares. Wanda Media has pledged to make a profit of at least CNY4 billion through the year 2021 as part of the agreement.

Wanda Film's stock has tumbled to CNY21.88 since it resumed trading on Nov. 5 at CNY31.1, 10 percent less than when it suspended trading in July 2017 to pursue the deal. It hit the 10 percent daily limit down for four days straight after trading began again, which is the same day it made the CNY11.6 billion proposal to acquire Wanda Media.

The buyer had an operating income of CNY10.9 billion over the first three quarters, up more than 7 percent on the year, with box office takings gaining 15.6 percent to CNY7.5 billion, according to the company's financials. The number of tickets sold rose 17.2 percent to 182 million.

Wanda Media invests in, produces and distributes movies and television series and publishes online games. Wanda Film expects the merger to help it increase revenue from films, TV and games to add to its existing income streams from cinemas and advertising.

Wanda Group Chairman Wang Jianlin plans to reduce his holdings in Wanda Film, which are held via Wanda Investment and Wanda Culture Industry Group, to 41.75 percent from 48.09 percent after the deal, though he will remain the actual controller of the cinema operator.

Editor: James Boynton