Fosun Group denies selling its stake in Portuguese bank BCP; Fosun International’s total liabilities still exceed RMB 200 billion, while its cash reserves exceed RMB 110 billion.

Fosun’s path of asset sales remains far from complete. On March 19, Fosun International announced plans to sell its remaining ~20% stake in Portuguese bank Millennium bcp. This transaction is expected to generate approximately €836 million (about USD 910 million) in operating funds for Fosun International—roughly RMB 6.63 billion. It is reported that, upon completion of this deal, Fosun International will no longer hold any shares in the Portuguese bank. Currently, Fosun International is evaluating various divestment options—including seeking strategic buyers—with potential interest reportedly expressed by Spain’s Banco Bilbao Vizcaya Argentaria (BBVA) and CaixaBank. Industry analysts believe the sale of this 20% stake could bring in over RMB 6 billion in cash, significantly alleviating Fosun International’s debt pressure. A Goldman Sachs report states that Fosun Group aims to reduce its holding company debt to around RMB 60 billion by the end of 2025; to achieve this goal, the group may continue selling non-core assets throughout mid-2024. In response, Fosun Group swiftly denied recent reports claiming it was negotiating with banks to sell its BCP stake, emphasizing that no such negotiations are underway and reaffirming its long-term confidence in BCP’s development and future prospects.

The Fosun ecosystem has once again—yet again—cut its holdings! So, is Fosun’s debt really RMB 650 billion—or just RMB 100 billion?

Summary: S&P downgrades rating (Follow @BestieFinance for more) The Fosun ecosystem has cut its holdings—yet again! On September 19 and 20, New China Life Insurance and Yuyuan Stock Co., Ltd. successively issued announcements disclosing share reductions by entities within the Fosun ecosystem. Just days earlier, Guo Guangchang—the so-called “Chinese Warren Buffett” and chairman of the Fosun ecosystem—had publicly refuted claims about RMB 650 billion in debt during a small-scale investor briefing. He also directly challenged Bloomberg’s report titled “Chinese regulators have asked banks and some state-owned enterprises to assess their exposure to Fosun-affiliated companies,” calling it severely inaccurate and vowing legal action to defend the company’s rights. Yet since the beginning of this year, media outlets including the China Times and the Yangtze River Business News have repeatedly reported that the Fosun ecosystem has been continuously reducing its stakes and raising over RMB 10 billion in proceeds—raising questions about the true state of Fosun’s debt. 01 The Fosun ecosystem operates across a broad spectrum and comprises numerous subsidiaries. According to its official website, Fosun has industrial presence in nearly 30 countries and regions, employing approximately 96,000 people globally. Thus, understanding its debt situation first requires grasping the basic structure of the Fosun ecosystem. In 1989, Guo Guangchang graduated from Fudan University with a bachelor’s degree in philosophy. In 1992, he co-founded Fosun with fellow Fudan alumni, initially focusing on consulting and pharmaceuticals before expanding into real estate and participating in SOE mixed-ownership reforms—including those of Yuyuan Garden, Nanjing Iron and Steel, and Zhaojin Mining—thereby evolving into a diversified conglomerate. In 1998, Fosun Pharmaceutical (formerly Fosun Industrial) listed on the Shanghai Stock Exchange, becoming Shanghai’s first privately owned listed enterprise. In 2007, Fosun International listed on Hong Kong’s Stock Exchange, launching its global expansion strategy. Thereafter, the Fosun ecosystem continued aggressive business growth and investment—especially after 2012, when it entered an intensive acquisition phase: investing in the maternity-and-baby platform BabyTree; establishing Fosun Tourism Group; acquiring English football club Wolverhampton Wanderers; and making overseas investments in banking, cosmetics, and jewelry. Between 2019 and 2020, the Fosun ecosystem further entered the baijiu sector, acquiring a 38% stake in Jinhui Liquor via Yuyuan Stock Co., Ltd., and later acquiring a 70% stake in Sichuan Tuopai Shede Group Co., Ltd. According to Fosun International’s 2021 annual report, the company operates four core business segments: Health, Happiness, Wealth, and Intelligence (see diagram below). The Fosun ecosystem spans finance, culture & tourism, pharmaceuticals, real estate, information technology, steel, and other sectors—operating across both primary and secondary markets. Image source | 21st Century Business Review (Special thanks!) 02 Over the past decade, Fosun’s rapid expansion has proven a double-edged sword. On one hand, it achieved its strategic objective of global footprint; on the other, its excessively broad scope and overly aggressive pace of expansion have led to surging debt—particularly in recent years, as compounded by pandemic impacts and macroeconomic cycle shifts, resulting in pronounced volatility for the Fosun ecosystem. The fluctuating rankings of its founder, Executive Director, and Chairman Guo Guangchang on billionaire lists offer indirect evidence of this turbulence. In 2016, Guo Guangchang ranked 28th on the Hurun Rich List with wealth of RMB 44.5 billion. On the New Fortune 500 Rich List: — In 2017, he ranked 28th; — In 2018, his wealth rose to RMB 57.97 billion, lifting him to 22nd place;

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