Fosun Buys Chinese Baijiu Liquor Maker For $694m in Local Pivot

Fosun Buys Chinese Baijiu Liquor Maker For 4m in Local Pivot

Fosun International Ltd. is acquiring a controlling stake in Sichuan Tuopai Shede Group Co., boosting its presence in
the coveted baijiu liquor sector as the Chinese conglomerate led by billionaire Guo Guangchang pivots inward for

 Fosun will buy a 70% stake in the liquor and spirits maker for 4.53 billion yuan ($694 million) in cash, the company
said in a Dec. 31 exchange filing. This is the second such investment in 2020 by the Fosun Group after it bought a
30% stake in another maker of the fiery wine — a hot favorite in China — in July.

 The transaction underscores the domestic push underway at the insurance-to-tourism conglomerate as the Chinese
economy rebounds from a pandemic-induced slowdown, even as western nations still struggle to contain the
coronavirus outbreak.

 Fosun is “optimistic about the potential growth of the target company which operates a high-quality liquor and
spirits business,” it said in the filing, adding that the deal will cement its foothold in businesses which “support the
lifestyle” of modern Chinese consumers.

 Asset-Price Downturn

 Its founder Guo said in March that it will seek out investment opportunities as the “once-in-a-century” coronavirus
pandemic sparks an asset-price downturn. Fosun is one of the largest and last remaining acquisitive Chinese groups.
Its businesses span health care, insurance, tourism and leisure, and about 45% of its revenue was from overseas in

 The pandemic, which forced people to stay home for months and shun travel, hit Fosun’s tourism and retail
businesses the hardest, Guo told Bloomberg Television in August. It lost its 20% stake in the struggling circus
operator, Cirque du Soleil Entertainment Group the same month.

 The conglomerate is now betting on its pharmaceuticals division to offset the slump as its unit Shanghai Fosun
Pharmaceutical Group Co. gears up to market Pfizer-BioNTech’s coronavirus vaccine in Hong Kong.

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