- Firm has $2 billion of acquisitions yet to be completed
- Deals in the works range across insurance, banking, movies
Fosun International Ltd. -- the firm whose billionaire chairman is reportedly missing -- has built an empire sprawling across insurance, real estate and entertainment, with another $2 billion of acquisitions announced this year and yet to be completed.
Fosun is competing for Anglo-German banking group BHF Kleinwort Benson Group and agreed to acquire Israeli insurer Phoenix Holdings Ltd. in June. Fosun is in the process of acquiring German private bank Hauck & Aufhaeuser Privatbankiers KGaA and is among investors offering to take Chinese movie studio Bona Film Group Ltd. private.
Existing assets span finance -- especially insurance -- property, steel, leisure, health and natural resources such as oil and gas. Insurance businesses acquired by Fosun, such as Portugal’s Cia de Seguros Fidelidade Mundial SA and Bermuda-based Ironshore Inc., provide low-cost funding for acquisitions in other industries.
Insurance may account for as much as 70 percent of Fosun’s assets in three years, Citic Securities Co. forecast in April. That would be up from 30 percent at the end of June.
Fosun has put money into:
- Entertainment company Cirque du Soleil Inc.
- Studio 8, founded by Jeff Robinov, the former president of Warner Bros. Pictures.
- Greek jewelry brand Folli Follie
- Resort company Club Mediterranee SA
- 28 Liberty, a 60-story building in New York formerly called One Chase Manhattan Plaza
- Italian suitmaker Raffaele Caruso SpA
- A Chinese life-insurance venture with Prudential Financial Inc.
- Stakes in listed Chinese companies including China Minsheng Banking Corp.
In health care, Shanghai Fosun Pharmaceutical Group Co. is developing drugs, consolidating businesses in China and targeting acquisitions overseas. Shanghai Forte Land Co. develops and sells residential and commercial real estate across China.
Fosun spent $5.7 billion over two years acquiring insurance assets, according to data compiled by Bloomberg. Low interest rates in Europe, the U.S. and Japan would facilitate more such purchases, the company said in a presentation accompanying its first-half results in August.
In August, Guo Guangchang, the man now reported by Caixin magazine to be missing, said that Fosun aimed to grow its private banking business to manage more than $100 billion. In October, the company completed a $1.5 billion rights offering, with some of the money tagged for mergers and acquisitions in banking and insurance.
The company will keep buying insurers to tap low-cost funding, Guotai Junan Securities Co. said in a July report. The purchase of Cia de Seguros Fidelidade Mundial helped boost Fosun International’s gross premium income by more than 10 times in 2014 from the previous year, according to the report.
— With assistance by Dingmin Zhang, and Jonathan Browning