Odeon & UCI Cinemas is the largest operator of theaters on the European continent, with 2,179 screens in 236 cinemas in seven countries, including the UK, Spain and Germany. It is owned by Terra Firma Capital Partners Ltd, a British private equity firm, which combined Odeon and UCI in 2004 after paying $1.3 billion for both. The firm attempted to sell the theater chain in 2011 and is expected to do that again soon.

A person close to the talks said that Wanda has also approached Vue Entertainment, but that the UK company is not interested in a deal, according to the Wall Street Journal.

Vue Entertainment operates 1,150 screens in 120 cinemas in five European countries and in Taiwan.

"I don't think it's a good deal for Wanda to purchase overseas theater chains, because China is showing much more potential for market growth in the film industry compared with the market in North America and Europe," said Huang Qunfen, general manager of Beijing New Film Association Co Ltd, one of China's largest theater chains.

The world's second-largest movie market, China generated $2.7 billion in box office revenue in 2012, grabbing nearly 8 percent of the global market, while North America accounted for a 31 percent share with $10.8 billion in ticket sales, according to the Motion Picture Association of America.