New | China’s Fosun to sell assets to raise credit rating above junk

Fosun Group, one of China’s most acquisitive conglomerates, is preparing to sell as much as 40 billion yuan (US$6 billion) in assets as it focuses on raising its credit rating to above junk.

After announcing more than $15 billion in overseas acquisitions since 2010, the group plans to disclose the disposals between now and the end of 2017, Liang Xinjun, chief executive officer of flagship unit Fosun International Ltd., said in an interview aired on Bloomberg Television on Monday.

“We will sell assets to repay debts,” Liang, 47, said in Shanghai. “We have ample capability to get investment grade ratings. So either strategically, or tactically, Fosun is crystal clear that this has become our strategy.”

Fosun’s dwindling appetite for foreign trophies -- it owns Club Med, Wall Street’s 28 Liberty building and Cirque du Soleil -- makes it an outlier at a time when the likes of China National Chemical Corp. and Dalian Wanda Group Co. are pushing Chinese companies to their biggest-ever year of overseas acquisitions. Rather than joining the fray, Fosun is focusing on getting leaner before its next phase of growth.

Fosun’s dollar bonds due in 2020 saw their biggest increase since January, according to prices compiled by Bloomberg. Shares of Fosun International and Shanghai Fosun Pharmaceutical Group Co. rose in early trading in Hong Kong before closing lower.

Liang is one of the three founders running the insurance-to-mining conglomerate -- the other two being Chairman Guo Guangchang and President Wang Qunbin. Guo, whose brief disappearance in December triggered a rout of Fosun shares, signalled the group will move away from centralized leadership.