July 31, 2017 / 4:59 AM / in 2 years

Fosun's Guo says backs China crackdown on overseas deals

SHANGHAI (Reuters) - One of China’s richest men and most active global dealmakers has given his backing to a crackdown on overseas investments, a drive which has stymied deals and brought the spotlight onto the offshore dealmaking of a number of China’s top firms.

Guo Guangchang, Chairman of Fosun International, speaks during a Reuters Newsmaker event in Beijing, China, June 28, 2016. REUTERS/Kim Kyung-Hoon

Guo Guangchang, chairman of Chinese conglomerate Fosun International, said in a note on Saturday that tougher rules on overseas deals were “essential and timely” to root out risky investments and sort out financial “chaos”.

“This can certainly eradicate a significant amount of irrational investment and things that are potential risks to financial security,” Guo said in a letter posted on Fosun’s official microblog on Tencent’s WeChat.

“If no steps were taken then foreigners would simply think that Chinese firms were just “silly money”, he added.

Beijing’s suppression of showy overseas deals has drawn in corporate giants including property developer Dalian Wanda, HNA Group, Anbang Insurance, Fosun and Zhejiang Luosen, which was behind the purchase of A.C. Milan football club.

Guo said the campaign against risky deals was reasonable and that some people were overblowing it. He added China’s support for rational overseas investment had not wavered.

“I believe this support will continue, Chinese firms need to have a seat at the global economic table,” he said.

Fosun, which owns assets including overseas insurers and French holiday firm Club Mediterranee, announced a deal to buy French margarine maker St Hubert with Beijing Sanyuan Foods Co Ltd last week.

Guo was drawn into the spotlight in 2015 when media reports that he had gone missing sparked speculation that Fosun had been drawn into an anti-graft campaign.

The firm, one of China’s most acquisitive overseas dealmakers, later said Guo had been helping police with a probe that mostly concerned his personal affairs.

Reporting by Adam Jourdan; Editing by Stephen Coates

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