Fosun to Invest Over $4.8 Billion Mainly in Consumer, Finance
Fosun International Ltd. (656), a Chinese company that last year took a stake in Greece’s Folli Follie Group, expects 2012 investments to surpass the as much as 30 billion yuan ($4.8 billion) it spent in 2011, its chairman said.
“We will mainly invest in consumer and financial services sectors,” said Fosun Chairman Guo Guangchang, adding that the company is looking at opportunities in clothing, tourism and the cultural industries both in China and abroad.
Shanghai-based Fosun, which also has stake in mining, steel, property and drugs, is also interested in buying into a fast-food restaurant chain in China, Guo said yesterday in an interview in Beijing, where he’s attending the annual meetings of the National People’s Congress, or China’s legislature.
Premier Wen Jiabao set a 2012 economic growth target of 7.5 percent on March 5, lower than an 8 percent goal in place since 2005. He pledged to adjust taxes as the nation seeks to end the economy’s reliance on investment and exports in favor of boosting domestic consumption.
“Our principle is to connect China and the rest of the world. When we make foray into foreign markets, we would like to add China elements,” said Guo, who ranked 27th on Forbes Magazine’s 2011 China rich list with an estimated wealth of 17.5 billion yuan ($2.8 billion).
Fosun is investing in the consumer industry as it seeks to diversify its business. The company, which also has a stake in French resort operator Club Mediterranee SA (CU), paid 84.6 million euros ($112 million) for 9.5 percent of Folli Follie, the Greek operator of Hellenic Duty Free Shops and maker of jewelry and handbags.
China Luxury Market
The luxury goods purchases in China and by Chinese consumers reached a total of 212 billion yuan in 2010, Bain & Co. said in December. The Greater China region is the world’s third-largest market for luxury goods, according to the consulting firm.
Demand for luxury goods in China has surged as a result of growth in the world’s second-biggest economy. The average disposable income of urban households increased 14 percent to about 21,810 yuan in 2011, data from the National Bureau of Statistics showed.
To contact the editor responsible for this story: Stephanie Wong at email@example.com