Thomas Tull, who co-founded Legendary Entertainment 11 years ago before selling the company to Chinese conglom Dalian Wanda Group a year ago in a cash deal valued at $3.5B, is leaving his post as Chairman and CEO of Legendary. His exit follows news out of China that Dalian Wanda posted its first sales decline in 11 years, despite the fact that income from its global film operations was up 31.4% last year. The investment in entertainment is widely seen as its way out of its real estate woes.

Tull’s agreement with the Chinese was built on performance guarantees and was said to have provided no upfront cash to the Legendary co-founder. Wanda decided months later to delay putting the company into its entertainment portfolio because of the tenuous state of China’s stock market. At the time of the purchase, Wanda — which acquired 100% of the equity stake in Legendary — boasted that it marked the “largest cross-border cultural acquisition.” It also had plans to take the company public.

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Tull’s exit comes as a surprise to the industry, as Wanda’s chairman Wang Jianlin specifically had named Tull as one of the reasons he had so much faith in Legendary in the first place. Legendary produced the Chinese box office hit Warcraft and has a number of tentpole films on its way including Kong: Skull Island and Pacific Rim Uprising. We understand that it was a short honeymoon as Tull and his Chinese bosses began to clash over the management of films. Tull was responsible for Legendary’s day-to-day operations which included TV, digital and its a comics unit. The company says he will be replaced.

In the meantime, two things are happening at Legendary now: Jack Gao, Group SVP & CEO of International Investments and Operations at Wanda Cultural Industry Group, has been named as the Interim CEO, while Mary Parent now becomes the senior-most American film executive at Legendary. Parent, who has a great deal of experience in production, is remaining on board.

Legendary produced the Matt Damon-starring The Great Wall, the first tentpole-sized English-language film produced in China. Directed by local helmer Yimou Zhang, the film, which also includes some of China’s biggest box office draws, has grossed $160M in the Middle Kingdom alone out of a $200M international gross.

Here is the release from Wanda Group: