Top 10 biggest losers of wealth in China 2011
- By Zhang Junmian
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E-mail China.org.cn, February 16, 2012
He Xiangjian & Family 何享健家族
Company: Midea Group 美的电器
Sector: Electronic appliances
Shares: 43.03 percent in Guangdong Midea Electric Appliances Co. Ltd.
Stock code: 000527.SZ
Current wealth: 17.8 billion yuan (US$2.83 billion)
Losses: 8.3 billion yuan (US$1.32 billion)
Percentage lost: 31.8 percent
He Xiangjian, chairman of China's leading appliances maker Midea Group, was ranked 14th on the Money Week's rich list of 3,000 Chinese families 2011. However, He lost 8.3 billion yuan (US$1.32 billion), or 31.8 percent of his fortune, by the end of 2011.
In 2011, growth of the home appliance sector noticeably slowed. As a four-year growth-boosting policy came to its end, the explosive trend of home appliance sales in rural areas also drew its curtain. Midea's sales grew by 40 percent in the first half of 2011 but have been sliding since. Its return-on-equity ratio fell from over 25 percent in 2010 to 15 percent in the first three quarters of 2011, forcing it to shift from its quantity-oriented model to focusing on its products' quality. It is also reported that company management also laid off about 8,000 of its 9,000 sales staff by the end of 2011.
In late October, Midea transferred 15.3 percent of its shares to two PE firms – Yon Rui Investment Co. Ltd and CDH Investments, aiming to pave the way for its holistic listing. In addition, Midea is planning to develop India into its fifth manufacturing base abroad after Vietnam, Egypt, Belarus and Brazil. It has reached an agreement with Carrier Corporation, the world's leader in heating, ventilating and air conditioning (HVAC) systems on a US$33 million joint-venture in India.
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