Dalian Wanda Group’s $1 billion deal to buy Dick Clark Productions is near death’s door.

Barring an eleventh-hour change in the company’s thinking, we’re told it’s “highly probable” that the Wanda-DCP deal would be dead as soon as Friday. Once acceptable, the $1 billion price tag may have become high as Wanda faces possible financial issues stemming in part from other big-ticket Hollywood investments, most notably, the $3.5B bid for Legendary Entertainment. The deal also could put Wanda in an uncomfortable position with Chinese officials who want to limit capital flight and U.S. lawmakers who warn that China is becoming too influential in Hollywood.

Wanda would have to pay a “very substantial” but unspecified break-up fee if it backs out of the deal it made in November for the production company behind the Golden Globes, the Billboard Music Awards, the American Music Awards, Dick Clark’s New Year’s Rockin’ Eve With Ryan Seacrest and other events.

Wanda is believed to have enough funds outside China to buy DCP from former Guggenheim Partners president Todd Boehly’s Eldridge Industries. At January’s World Economic Forum in Davos, Wanda Chairman Wang Jianlin said his company had earmarked $5B-$10B per year for overseas investment with the U.S. the top priority.

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But here is the glitch, coming due for Wanda (which is heavily leveraged) is a well over $2B note that is coming due to investors since it borrowed for the acquisition of Legendary Entertainment.

Wanda paid $3.5B last year for Legendary while Wanda-controlled AMC Entertainment became the world’s biggest exhibition chain with a $1.1B acquisition of Carmike Cinemas and a $1.2B deal for UK’s Odeon & UCI Cinemas. In January, it agreed to pay $929 million for Nordic Cinema Group.

But the company appears to be reassessing how much more it wants to bet on Hollywood. “Wanda is simply backing out of a deal they don’t want to do,” says a film industry exec.

Another said the deal was going south, partially because Wanda has cash issues and partially because “the entire premise of the deal was flawed which they found out in typical Chinese fashion – after they announced the deal. They realized that they didn’t own the Golden Globes but the production rights to the Golden Globes. Their plan was to move it out of Hollywood. However, then they found out what they really owned and it was only the production rights. Those two things combined led the Central Government to say no you can’t have any more money moved out of the country.”

The company’s revenues dropped 14% in 2016. That was Wanda’s first decline in more than a decade and exceeded its forecast for a 12% drop. Meanwhile, the value of shares in its Wanda Cinema Line exhibition chain have fallen more than 29% during the past 12 months.

The real estate giant delayed the Dick Clark Productions deal in February, due at least in part to China’s effort to limit capital flight. Officials in Beijing fear that the country’s capital reserves will become depleted if companies use their cash to buy overseas properties as the value of the yuan declines vs. the U.S. dollar.

“Every company in China is having a hard time getting money offshore right now,” a source says. “A tightening of controls has definitely happened.”

Last year the yuan depreciated 7% to its lowest exchange rate in eight years against the strengthening greenback. Among other things, officials in Beijing ordered several major banks to cut back on letters of credit.

Meanwhile, some U.S. lawmakers have become suspicious of Chinese investments in entertainment.

Rep. John Culberson (R-TX) wrote to Assistant Attorney General John Carlin in October asking him to examine Wanda. He also wanted the Justice Department to determine whether the Foreign Agents Registration Act (FARA) was being “effectively used as a tool to address foreign lobbying and propaganda efforts in the United States, especially by countries like China and Russia.”

President Trump also said during last year’s election campaign that he might levy a 45% tariff on Chinese imports. He charged that the PROC had taken jobs from the U.S.

A few days after he won the election in November, Trump spoke with China President Xi Jinping during a call in which Xi told his future U.S. counterpart that “cooperation is the only correct choice for China-U.S. relations.”