Fosun hits back over ratings review after purchase of Portuguese insurers
Moody's and S& P's move spurs investment company to defend purchase of Portuguese insurance firms, saying it has enough money
Fosun International chief executive Liang Xinjun has hit back at two international credit rating agencies that are reviewing their ratings of the company following the acquisition of three Portuguese insurers, saying its financial situation is comfortable.
The Hong Kong-listed investment company announced last week it had acquired 80 per cent stakes in three wholly owned subsidiaries of Caixa Seguros e Saúde, the insurance arm of Portuguese state-owned bank Caixa Geral de Depósitos, for €1 billion (HK$10.6 billion).
Liang said yesterday Fosun had prepared adequate capital for the purchases and there was no need to worry.
"I have not yet read the details of the reviews," he said. "As rating agencies, they focus on safety.
"Rating agencies do not prefer investment. What they prefer is leaving money on the books and not touching it. That is the safest way. But investors in our bonds and shares want us to develop."
The transaction exceeds Fosun’s cash resources and internally generated cash
Liang's comment came a day after Moody's Investors Service placed Shanghai-based Fosun's Ba3 corporate family and B1 senior unsecured ratings under review for downgrades.