China Post not to stay in hotels
By Ding Qingfen (China Daily)Updated: 2007-03-23 09:03
Moving aggressively to disengage from its hospitality
business, China Post Group is trying to concentrate more on its core business.
The group yesterday started listing 30 of its star hotels from its stable of 400-odd ones on Shanghai United Assets & Equity Exchange (SUAEE) for asset trading, responding to the call by Premier Wen Jiabao.
At the recent annual session of the National Committee of the CPPCC, the premier said State-owned companies should overhaul themselves by gradually moving away from their non-core businesses.
"We will focus only on postal services in the future, and sell or transfer first our hotel assets and then the ones in other sectors," Ren Yongxin, deputy general manager of the Finance Department under China Post Group, told China Daily.
There are more than 400 hotels under China Post Group, but it selected the top 30 for the trading experiment, in which Phoenix Asset Management Co Ltd will act as the mediator.
Most of the group's hotels are rumored to be running at a loss. But Ren refused to comment on this, saying: "There's no problem with profitability, the initiative is aimed at sharpening our core competence".
As the 2008 Beijing Olympics - a golden time for the local hospitality industry - is drawing near, "a professional hotel operator could do a better job than us in helping these hotels perform better and improve their brand equity", Ren said.
The 30 hotels listed on the SUAEE are located in 17 cities across China. They include 4 four-star and 13 three-star hotels.
"We are likely to finalize the deals on the 30 hotels by the end of 2007, and will then come out with the next batch. By the end of 2008, all the 400-odd hotels will be available for trading on the SUAEE," said Ren.
This is not the first time China Post Group is trying to offload its non-core businesses. "We have about 1,000 properties in the non-core sector, ranging from hotels and hospitals to printing facilities," Ren said.
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