Taking active steps to move away from the hospitality business, China Post Group has decided to focus more on its core business.

The group chose 30 of its star-rated hotels from its stable of close to 400 to place on the Shanghai United Assets & Equity Exchange (SUAEE) for asset trading purposes.

At the recent CPPCC annual session, Premier Wen Jiabao stated that state-owned companies should begin a complete overhaul aiming to cast adrift their non-core business thus improving services in core ones.

"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.

China Post Group manages over 400 hotels and it has selected the top 30 for this trading experiment, bringing in Phoenix Asset Management Co Ltd to act as a mediator.

Rumors are rife that most of the group's hotels are operating at a lost but Ren refused to comment on this, saying only: "There's no problem with profitability, the initiative is aimed at sharpening our core competence".

As the 2008 Beijing Olympics -- a time of plenty for the city's hospitality industry -- draw close, "a professional hotel operator will perform a better job in getting these hotels to provide strong servies and improve their brand equity", Ren said.

The 30 hotels newly listed on the SUAEE are spread across 17 Chinese cities, covering 4 four-star and 13 three-star hotels.

"We aim to finalize the deals on these 30 hotels by the end of 2007, before bringing in the next batch. By the end of 2008, all our 400-odd hotels will be available for trading on the SUAEE," said Ren.

This move is not the first made by China Post Group in seeking to off-load 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.

(China Daily March 23, 2007)