* Reshuffle will have short-term impact on company -
* Fosun says CEO Liang Xinjun resigned for health reasons
* Analysts raise concerns over firm's strategy after
* Profits soar 28 percent to more than 10 billion yuan
(Adds more context on capital outflows, M&A, Wang)
By Anne Marie Roantree and Julie Zhu
HONG KONG, March 29 Fosun International Ltd
, one of China's most aggressively acquisitive
conglomerates, said its chief executive and vice president
stepped down in a surprise reshuffle that has raised concerns
over the group's strategy.
The resignation of co-founder and Chief Executive Liang
Xinjun and Senior Vice President Ding Guoqi will have some
impact on the leisure-to-insurance group, one of China's largest
privately held firms, said chairman and fellow co-founder Guo
"The departure of Ding Guoqi and Xinjun, in particular that
of Xinjun due to health reasons, will have an impact on Fosun in
the short-term," Guo told reporters and analysts in Hong Kong,
"But we have to turn bad things into good news. As you all
see today, the new management team, Fosun is full of talents."
Liang, who was Fosun's public face, was replaced by fellow
co-founder and billionaire Wang Qunbin, said the company, whose
businesses include French leisure group Club Med and
entertainment company Cirque du Soleil.
Wang, a genetic engineer by training who owns 11 percent of
Fosun International Holdings, has kept a lower-profile than the
firm's other co-founders.
Fosun has been the posterchild for China's decade-long
outbound push, which saw Chinese bidders spend a record $105
billion on assets ranging from movie studios to football clubs
But over the past year Beijing has begun reining-in outbound
deals in a bid to curb outflows - estimated to be more than $725
billion last year - and shore-up the weakening yuan which fell
to eight-year lows in December.
Guo and Chief Financial Officer Robin Wang reassured
investors regarding the impact of Beijing's capital
restrictions, saying they were a "challenge" for the group but
that it continued to have several means of raising capital
offshore, which could actually offer Fosun more opportunities to
compete for assets.
These included offshore bonds and also using the group's 20
billion euros' worth of insurance assets.
Guo emphasised the group's strategy to contain funding costs
while investing heavily in new technologies, including
artificial intelligence and automation.
Along with its reshuffle announcement, Fosun reported a net
profit jump of 28 percent to a record high of over 10 billion
yuan ($1.45 billion) in 2016, led by gains from its investments
in finance, healthcare and tourism-related businesses.
Several sources close to Fosun said there had been growing
tensions between Guo and Liang.
On Wednesday, Guo said he had been especially "hard and
demanding" on Liang but said he, Liang and Wang - college mates
who went on to work together for 25 years - remained as close as
"Xinjun, Wang Qunbin and myself have never abandoned each
other, we are like brothers. Xinjun has made a great
contribution to Fosun's development today," Guo said.
Liang and Ding, who stepped down due to family commitments,
will have no honorary positions in the company.
Liang, who owns 24 percent of the group and has a personal
fortune worth $2.2 billion according to Forbes Real-Time
Billionaires List, was instrumental in driving Fosun's
He took on a more prominent role when Guo became embroiled
in an investigation on the Chinese mainland in late 2015. (reut.rs/2mP2Psb)
The company's shares opened up initially but then quickly
steadied on Wednesday. Its bonds traded slightly lower on fears
the departure of two key executives could hurt its acquisition
strategy, analysts said.
"With the latest announcement, one more founder together
with another key personnel have left," said Annisa Lee, a Nomura
"This may raise concerns on the company's business and
financial strategy going forward and that's why bonds are
($1 = 6.8779 Chinese yuan renminbi)
(Additional reporting by Elzio Barreto, Umesh Desai, Sijia
Jiang, and Michelle Price in Hong Kong; Writing by Michelle
Price; Editing by Stephen Coates and Randy Fabi)