M&As high up on Fosun’s timetable
Fosun Tourism Group — the leisure-and-travel arm of Shanghai-based investment conglomerate Fosun International — will continue to look for acquisition opportunities worldwide, banking on consumption upgrade in China’s tourism industry.
Tourism is a global business, and global acquisitions will be the future trend in the tourism business, with eye-catching international merger-and-acquisition deals having been sealed in the past, says Qian Jiannong, chairman and chief executive of Fosun Tourism Group.
Fosun itself had acquired European international resorts group Club Med in 2015.
He said the industry’s resources are still relatively scattered, so M&A opportunities will continue to crop up in future.
Fosun is building a “Fosun holiday ecosystem”, embracing resorts, vacation destination management and tourism products, and is trying to acquire assets that can fit into the ecosystem and have synergy with its current business, according to Qian, who’s also a global partner of Fosun International.
The hunt for M&A opportunities comes on the back of the group’s confidence in and understanding of China’s domestic tourism industry.
“The first trend we see in the country’s tourism industry is consumption upgrade, which means we need to change on the supply side,” Qian told China Daily on the sidelines of Global Tourism Economy Forum 2018.
He explained that if a company does nothing on the supply side, it will not be able to keep up with the rising demand that comes along with consumption upgrade.
“We’re seeing travelers leaning on overseas travel or just suppressing their need to travel as they simply just don’t want to go to overcrowded scenic places,” he said.
To meet the demand for consumption upgrade in the industry, Fosun Tourism has been concentrating its resources on leisure vacation as the company sees that, currently, most domestic travelers are still doing “sightseeing”, but will gradually upgrade themselves to leisure vacation.
And, that’s the reason Fosun took over Club Med and helped it launch Club Med Joyview brand to provide short-haul holiday experience for families and corporate consumers in first-tier cities
The industry’s resources are still relatively scattered, so M&A opportunities will continue to crop up.”
on the Chinese mainland.
Driven by increased income levels and well-developed infrastructures, a growing number of mainland travelers are going overseas to take in the exotic experience and learn about different cultures.
Qian expects the number of mainland outbound travelers to continue seeing rapid growth in future.
“Apart from Club Med, we’ve also invested in Thomas Cook, which has plenty of resources in Europe, including 3,100 travel agencies and 95 airplanes, and all these resources will be valuable and useful to Chinese travelers,” he said.