Wolves owners divest major assets to tackle debts

Wolverhampton Wanderers owners Fosun are set to make its largest divestment this year as it sells its majority shareholding in Shanghai-listed Nanjing Nangang Iron and Steel United.

This would take the conglomerate’s asset sales to £4.25bn this year – the group only sold £88m of assets in 2021.

The Financial Times reported in July that Fosun, headed up by Shanghai-based tycoon Guo Guangchang owes around $38bn following the Covid-19 pandemic and a slowing Chinese property sector. It also reported that Fosun is finding assets such as real estate and biopharmaceutical assets are particularly hard to sell in the current climate.

Moody’s has estimated that Fosun’s total debt stands at around Rmb260bn. The rating has been felt across the market as shares fell by 1.5% in Hong Kong on Thursday.

In September, the group lost 18% of its value following the announcement of the divestment of a Chinese pharmaceutical unit. This resulted in shares being at their lowest point since the end of 2012.

The group which owns 85% of Wolverhampton Wanderers, turned into equity £126.5m of shareholder loans, effectively writing off the debt the club owed to the owners in March.