In China, Herd of ‘Gray Rhinos’ Threatens Economy
Companies like Anbang Insurance Group, Fosun International, HNA Group
and Dalian Wanda Group have feasted on cheap debt provided by state banks, spending lavishly to build their empires.
“Everyone is concerned about Wanda Commercial’s debt problems,” Wang Jianlin, the chairman of Dalian
Wanda Group, said about the group’s main real estate subsidiary at a news conference on Wednesday.
“The downside of these new companies is that there was no one with the political or regulatory strength who could control these companies,”
said Brock Silvers, the chief executive of Kaiyuan Capital, a boutique investment banking advisory service in Shanghai.
Over the past five years, Wanda, Anbang, HNA Group
and Fosun have made at least $41 billion of overseas acquisitions, according to Dealogic, a research firm.
Anbang spent more than $10 billion in three years, deals
that were financed mostly by selling so-called wealth management products — opaque investments promising high rates and low risk.