Hou Jiyong – breakthrough when Fosun billion in assets under management, the Guo Guangchang within the company this year launched a new dream – Management “trillion in assets.”
Today, Fosun another step forward.
13 days, Fosun Group and Prudential Financial Group, the United States signed a strategic cooperation memorandum in Beijing, the two sides plan to set up a large equity investment fund.
insured assets, Prudential is ranked the second largest U.S. life insurer, as of September 30, 2010, Prudential Group’s assets under management of approximately 7,500 billion U.S. dollars. This will be the 135-year history of Prudential’s largest third-party asset management commission.
under the memorandum of cooperation, Fuxing investment 100 million U.S. dollars, Prudential invested 500 million U.S. dollars, Fosun for the GP (general partner), managed funds, Prudential only LP (limited partner).
13 days, Guo Guangchang interviewed to talk about “trillion in assets, a dream,” said: Fosun to future goals of the description is based on the possibility of a development goal setting, and then follow the established The steps to do step by step. Over time, the details will continue to do the change, “We are opposed to five years, the goals of the Decade.”
“trillion of assets Dream” is still Guo Guangchang heart, but he believes that “in the direction of development, the ability to grasp the opportunities”, Fosun have this possibility.
China’s new power
“21 century”: in the process of cooperation, how do you persuade Prudential to cooperate?
Guo Guangchang: the question is not who convince, but the value of China’s identity, the recognition of opportunities in China, we are willing to promote China’s development together. We both are very optimistic about China’s development, willing to share the achievements of China’s economic development, benefiting from the opportunities offered by China’s power. China is now the world’s fastest growing, the future is the world’s largest consumer market. Determined the initial framework, the latter so good.
“21 century”: Fosun Prudential Investment Fund which projects the future?
Guo Guangchang: with the “China Power” on the project, will vote. Including overseas enterprises, such as the Mediterranean club, will become co-fund investment.
“21 century”: a foreign enterprise, or local Chinese enterprises?
Guo Guangchang: We will vote. Will vote as part of the development of Chinese enterprises abroad will vote in the U.S. listed Chinese companies, which is equal to investment in Chinese enterprises, such as the Focus, but also non-Chinese investment enterprises, but can combine with the development of China’s enterprises such as the Mediterranean club, after our investment, with China’s development and well linked.
“21 century”: the two proportions?
Guo Guangchang: There are half and half.
“21 century”: You just mentioned that China is spending to upgrade the stage of expansion and consumption, which Fosun mean new investment opportunities?
Guo Guangchang: on, including luxury goods, including foreign brands, we are very interested. Chinese consumers can be accepted by our judgments in China. Such as Club Med, why the Chinese people will like? Because Club Med is ideal for family travel, the Chinese people attach great importance to the family, we had a child, it is difficult to enjoy myself. If you take the children, their own how to play. Club Med to solve this problem.
“21 century”: How Chinese capital market development?
Guo Guangchang: have confidence in the Chinese economy, China’s capital market should have confidence. China’s capital markets are a lot of criticism, the Chinese economy has also been much criticism, but as long as we continue to improve, we will have a chance. We will make mistakes, but the chances are the main.
turn read the history of the U.S. economy, their problems than we are more than. Fosun value, is to find good companies to create value for investors.
most important to Buffett mode
“21 century”: Do you like Jack. Welch, Li Ka-shing, Warren Buffett, another asset management last year, is not close to Warren Buffett?
Guo Guangchang: Fosun investment has four models, one model of Li Ka-shing, one is the GE model, one is the Buffett model. The fourth is purely an investment company, such as our partners Carlyle, Bain, Blackstone, mainly other people’s money management, but also have their own money. The four models have been successful, are we learning goals.
but we think that the best, the ideal of the model, or the Buffett model. For investment, the two things most important thing is the source of funds is long-term sustainability, and cost, he managed insurance fund, the cost is very low, even negative interest rates; second, because the funds are long-term and sustainable, investment, value investing can adhere to long-term investment.
“21 century”: Fosun how to complete the transition to the Buffett model?
Guo Guangchang: We use five to ten years to complete this transformation, our future more will adopt this model (Buffett model) to do.
each model is different from the structure, we hope that the funds manage more people, we have the ability to manage. Prudential in particular is to find such a partner, in exactly the same on the values is not easy. Fosun to increase financial management, in particular the intensity of management of overseas funds.
“21 century”: the time of investment, there will be other partners involved?
Guo Guangchang: the fund which in addition to rehabilitation and Prudential, the investment will not have any third party, is the cooperation between Fosun and Prudential. When conducting specific transaction, there will be the integration of third-party funds.
“21 century”: the return on investment requirements?
Guo Guangchang: We are very concerned about the investment risk, return cycles. Any capital investment, will have the same consideration. Speaking of return on investment, taking into account risk and return of capital cycle. Specific rate of return, should generally similar to or even better return on investment.
“21 century”: the future is Fosun Group, What is the relationship between investment companies?
Guo Guangchang: We work with the following three assets of corporate relations, a kind of developed our own industries, such as medicine, real estate; another called strategic investment, will vote 10% to 20% This may become a holding company, the long-held business, they may quit, the third is pure PE investments to finance investment purposes.
no matter what kind of investment, I want to be voted on to make a valuable contribution to the company to achieve value creation. Purely financial investment, is not cast.
“21 century”: the future focus will be to Fosun PE here?
Guo Guangchang: We will not be fully shift the center of gravity, I follow the development of strategies for each piece has a very good development.
Fosun New World
“21 century”: When the establishment of overseas funds? When a second foreign funds?
Guo Guangchang: This is our first foreign fund, all of the U.S. dollar, there are no plans for a second. We feel that management of the assets of others, than to manage their own assets to be more careful, not completely ready, will not easily go to management, the responsibility is very great.
“21 century”: Fosun from the management of overseas funds last year, why since last year?
Guo Guangchang: We started four years ago set up a fund, managed other people’s money, but the relatively small size since last year, more and more management people’s money. The second is our past investment in domestic enterprises, domestic enterprises two years ago started to invest in overseas listed companies, such as Focus; last year, companies started to invest abroad, but could benefit from China, such as the Mediterranean. This came to be step by step.
now we manage so much money on the grounds that the investment we are after so many years, found more opportunities to invest, can our logic, our value to the investment opportunities. Second, the Club Med that opportunity, not one, but many. This is our reason for setting up the Fund Prudential.
“21 century”: the establishment of overseas funds, how to choose a partner?
Guo Guangchang: We want to manage the funds and we have common values, is a long-term investment, value creation, rather than financial investment, short-term investments. Who’s money we do not have to, we are very happy to have found such a Prudential investment philosophy consistent with our partners, which is communication between us and the Prudential team, well the reason, it is very rare.
“21 century”: Fosun structure more complex, what do you do, how to participate in the company’s management?
Guo Guangchang: The original four partners, all entered the Fosun Group Board of Directors. I am the Chairman of the Board, General Liang (Liang Xinjun) is the CEO, General Wang (Wang Qunbin) is the president of General Fan (Fan Wei) is co-president in charge of this in the real estate.
Fosun board, including my own, the future is based on the perspective of a shareholder in the company’s management, the company is following the introduction of more professional managers. For professional managers, and our request is the entrepreneurial spirit of professional managers. Such as medicine, real estate and other businesses, have their own culture, but also outside of the introduction.
spend my energy on four main areas, and cultural development, strategy development, investment decisions on the introduction of professional managers.