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March 30, 2017

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Surprise reshuffle at Fosun to hit group

Source: Agencies | 00:01 UTC+8 March 30, 2017 | Print Edition

FOSUN International Ltd, one of China’s most aggressively acquisitive conglomerates, said its chief executive and vice president stepped down in a surprise reshuffle that has raised concerns over the group’s strategy.

The resignation of co-founder and Chief Executive Liang Xinjun and Senior Vice President Ding Guoqi will have some impact on the leisure-to-insurance group, one of China’s largest privately held firms, said chairman and fellow co-founder Guo Guangchang.

“The departure of Ding Guoqi and Xinjun, in particular that of Xinjun due to health reasons, will have an impact on Fosun in the short term,” Guo told reporters and analysts in Hong Kong, without elaborating.

“But we have to turn bad things into good news. As you all see today, the new management team, Fosun is full of talent.”

Liang, who was Fosun’s public face, was replaced by fellow co-founder and billionaire Wang Qunbin, said the company, whose businesses include French leisure group Club Med and entertainment company Cirque du Soleil.

Wang, a genetic engineer by training who owns 11 percent of Fosun International Holdings, has kept a lower profile than the firm’s other co-founders.

Fosun has been the poster child for China’s decadelong outbound push, which saw Chinese bidders spend a record US$105 billion on assets ranging from movie studios to football clubs in 2016.

Along with its reshuffle announcement, Fosun reported a net profit jump of 28 percent to a record high of over 10 billion yuan (US$1.5 billion) in 2016, led by gains from its investments in finance, health care and tourism-related businesses.

Several sources close to Fosun said there had been growing tensions between Guo and Liang.

Guo said yesterday that he had been especially “hard and demanding” on Liang but said he, Liang and Wang — college mates who went on to work together for 25 years — remained as close as ever.

“Xinjun, Wang Qunbin and myself have never abandoned each other, we are like brothers. Xinjun has made a great contribution to Fosun’s development today,” Guo said.

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