Club Med Case Study
B. What happened between Fosun and Club Med?
In 2010, Fosun invested in Club Med for roughly 9% of their shares. Another company, Ardian, also had 9% of Club Med until recently, when all their shares have been bought by Fosun. So Fosun now has 18%/18,5% of Club Med.
Club Méditerranée is a French corporation of vacation resorts created in 1950. It is considered as being the inventor of the all-inclusive formula. It is today composed of more than 80 resorts situated all around the world.
Since the beginning of 2014, a real battle is going on between 2 major competitors in order to acquire Club Med : Andrea Bonomi on one side and Fosun on the other side. The first bid was made by the association of companies owned by Fosun at the beginning of …show more content…
C. Why such a will to spend so much money for Club Med?
There are various explanations to this question. The first is that Club Med in worldwide-recognized brand and very successful one, at least as a global trend (last 2 years were not that good) and Fosun, as an investing company, is very looking for that kind of powerful and well-known acquisition.
With the acquisition of Club Med, Fosun main goal is to increase the presence for this company in China as it is seen as a great opportunity. Indeed, tourism for domestic market is more and more important as the global development of China goes on. Moreover, the increase of the minimal revenues in some sectors by 14% and the high pressure on work led to and increase of purchasing power of Chinese households and a need for …show more content…
Indeed, Bonomi’s past operations show that a very little concern is usually given to the bought company, the goals it to take as much profit as possible on the short term and to sell the company afterwards (example of Ducati). The risk could be that Bonomi would completely change the Club Med structure (even maybe change the all-inclusive formula) and affect the employees for example. Fosun promised that they would not do such thing and that they have a long-term vision for Club Med.
Fosun’s core values and aim matches very well with Club Med’s. It wants to buy and/or invest in companies in recovering market. This deal is a very good opportunity for Fosun to gain experience on the tourism market with a reasonable investment cost.
The example of Club Med shows how determined Chinese companies can be to acquire European firms. But how do they select the “right
In 2010, Fosun invested in Club Med for roughly 9% of their shares. Another company, Ardian, also had 9% of Club Med until recently, when all their shares have been bought by Fosun. So Fosun now has 18%/18,5% of Club Med.
Club Méditerranée is a French corporation of vacation resorts created in 1950. It is considered as being the inventor of the all-inclusive formula. It is today composed of more than 80 resorts situated all around the world.
Since the beginning of 2014, a real battle is going on between 2 major competitors in order to acquire Club Med : Andrea Bonomi on one side and Fosun on the other side. The first bid was made by the association of companies owned by Fosun at the beginning of …show more content…
C. Why such a will to spend so much money for Club Med?
There are various explanations to this question. The first is that Club Med in worldwide-recognized brand and very successful one, at least as a global trend (last 2 years were not that good) and Fosun, as an investing company, is very looking for that kind of powerful and well-known acquisition.
With the acquisition of Club Med, Fosun main goal is to increase the presence for this company in China as it is seen as a great opportunity. Indeed, tourism for domestic market is more and more important as the global development of China goes on. Moreover, the increase of the minimal revenues in some sectors by 14% and the high pressure on work led to and increase of purchasing power of Chinese households and a need for …show more content…
Indeed, Bonomi’s past operations show that a very little concern is usually given to the bought company, the goals it to take as much profit as possible on the short term and to sell the company afterwards (example of Ducati). The risk could be that Bonomi would completely change the Club Med structure (even maybe change the all-inclusive formula) and affect the employees for example. Fosun promised that they would not do such thing and that they have a long-term vision for Club Med.
Fosun’s core values and aim matches very well with Club Med’s. It wants to buy and/or invest in companies in recovering market. This deal is a very good opportunity for Fosun to gain experience on the tourism market with a reasonable investment cost.
The example of Club Med shows how determined Chinese companies can be to acquire European firms. But how do they select the “right