Shares in Fosun International, the flagship of Shanghai billionaire Guo Guangchang, plunged 5.9% to a more than nine-year low in Hong Kong on Tuesday, as the investment company closed its stake in the troubled global tourism unit Fosun Tourism, the owner of Club Med, reduced. and other luxury travel brands.
Hong Kong-traded shares of Fosun Tourism fell 22% on Tuesday. Fosun International sold $28 million after trading hours on Sept. 5 at a price of HK$8.57 per share to independent third parties, Fosun Tourism said in a statement after the close of trading. Fosun International still controls about four-fifths of Fosun tourism.
Shares of Fosun International closed at HK$5.10, the lowest point since April 2013. Fosun Tourism closed at HK$8.00, a 19-month low; it went public in 2018 for HK$15.60 per share.
Fosun Tourism, whose brands also include Atlantis and Thomas Cook, said last month it was beginning to recover from the worst impact of Covid-19 on its business. Revenue in the first half of the year more than doubled to 6.4 billion yuan, or $927 million, from 2.8 billion yuan a year earlier, and total hotel bookings at group accommodations more than doubled to 597,000, from 264,000 in the first six months. months of 2021, helped in particular by more stays in America and France.
However, stays in the company’s troubled home market in China fell to just 48,000 guests, from 115,000 a year earlier. China’s “zero-covid” policy and selective travel restrictions have hurt travel and hotel companies in the world’s No. 2 economy; GDP growth in the second quarter was only 0.4% compared to a year earlier.
Lockdowns continue this quarter ahead of the long mid-autumn festival holiday in China this weekend. Some 65 million people were locked up in the country on Monday, according to an The Bharat Express News report.
Fosun International said last month that net profit fell by nearly a third in the first six months of the year to 4.7 billion yuan. (See link here.)
Guo is worth $2.7 billion today on the TBEN Real-Times Billionaires List.
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