Fosun International sells assets amid credit rating cuts and liquidity concerns

Recent exchange filings show several stake sales that have helped raise about US$100 million in cash

Moody’s and S&P have downgraded Fosun’s creditworthiness this quarter amid looming debt maturity and liquidity challenges

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Published: 6:40pm, 20 Sep 2022

Fosun International, which owns the Club Med chain of resorts, has sold some of its peripheral assets to raise almost US$100 million in cash in recent weeks, as credit rating cuts heighten concerns about the conglomerate’s financial strength.

The group sold 38 million shares in Shanghai-listed retailer Shanghai Yuyuan Tourist Mart for 295.8 million yuan (US$42 million) in several transactions between August 26 and September 19, according to Shanghai Stock Exchange filings on Tuesday.

It also sold 26.1 million shares in New China Life Insurance for about 400 million yuan on September 15, trimming its ownership to 4.8 per cent and below the 5 per cent substantial shareholder threshold for the first time since 2016, a separate filing showed.

The sales, while small relative to the size of the group, followed recent reductions in its holdings in its flagship pharmaceutical and tourism units. They might do little to temper speculation about its finances. Fosun International last week denied a Bloomberg News report that Chinese regulators were asking banks to monitor its debt burden.