Fosun files IPO for Club Med on Hong Kong Stock Exchange

Club Med Cancún Yucatán pool
Club Med Cancún Yucatán Image: Club Med

As it prepares for an IPO, a subsidiary of Fosun International has announced plans to float its Club Med business in a bid to raise up to $700 million, three years after it won the global resorts operator for more than $1 billion in a lengthy battle with Italian investor Andrea Bonomi’s Global Resorts.

Fosun Tourism & Culture Group, which owns Club Med as well as a luxury resort in the southern Chinese coastal city of Sanya, did not give details of the share offering in a prospectus released late on Monday.

According to Reuters, the company is looking to raise between $500 million and $700 million in the IPO later this year, but sources could not specify how much of the company would be available. In the draft prospectus posted on the Hong Kong Stock Exchange website, the group said that the IPO proceeds would be primarily used to expand the existing business, acquire rights to additional land, fund potential investments and repay outstanding bank loans. Citigroup, CLSA and JPMorgan are the joint IPO sponsors.

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Club Med has resorts in more than 26 countries and regions. According to the prospectus, Fosun Tourism & Culture Group has consistently lost money over the past three years.

The move follows a year of announcements from Chinese companies seeking to offload assets in the wake of new government measures to limit and restrict what it has called extensive overseas investments made by domestic groups. Just two weeks ago, Anbang announced plans to offload its U.S. luxury portfolio, looking to raise money following its seizure by the Chinese government. HNA, meanwhile, agreed to sell its holdings in Radisson Hospitality AB and Radisson Holdings to a consortium headed by Jin Jiang International Holdings, which is controlled by the Shanghai government.