Meet CMIG, the Chinese Group Dicing With Default

Another acquisitive Chinese company is wobbling. Less than five years old, China Minsheng Investment Group Corp. has spent more than $4 billion on investments and amassed $34 billion of debt. Now it’s unable to make some bond repayments. CMIG joins the likes of HNA Group Co. and Anbang Insurance Group Co. in struggling to repay debt after embarking on a spending spree. At a time when China’s economic growth is slowing, the group’s troubles are under particular scrutiny, along with other big Chinese companies with plenty more debt repayments due this year.

One of the largest private investment champions in China, the group was set up by 59 non-state companies and obtained an operating license in 2014. Setting out with 50 billion yuan ($7.3 billion) in capital and a mandate to help Chinese private enterprise expand globally, CMIG has grown into a sprawling conglomerate that’s comparable to Fosun International Ltd., or a smaller version of the embattled HNA. It is unrelated to China Minsheng Banking Corp. though Dong Wenbiao, that company’s former chairman, ran CMIG until his retirement last year. He co-founded CMIG with some of Minsheng Bank’s founders and billed the group as China’s version of JPMorgan.