Fosun Invests in Dumpling Joint Made Famous by Xi
A state-owned dumpling restaurant chain, which made headlines after President Xi Jinping dropped by for lunch in 2013, has secured an investment from private conglomerate Fosun International Ltd.
The investment has been touted as an example of mixed-ownership reform, a national effort to reinvigorate the sluggish state sector by introducing private capital.
Beijing-based Qing-Feng Catering Management Co. Ltd., which serves steamed buns and other local dishes, has received more than 92 million yuan ($13.5 million) from four parties, including Fosun unit Shanghai Fosun High Technology (Group) Co. Ltd., the official People’s Daily reported on Wednesday. The report did not state how much Fosun’s subsidiary invested.
Fosun is the only party from the private sector to invest. The other three investors were the current sole shareholder, Beijing Huatian Catering Group Co. and its parent, a Beijing government-owned investment institution, as well as some of Qing-Feng’s current executives.
The deal will make Fosun the third-largest shareholder, with a 7% stake in Qing-Feng. Beijing Huatian will remain the majority owner, with 81.58% of the company’s shares.
Qing-Feng plans to use the latest investment to upgrade its stores and expand the business, according to the People’s Daily report.
Founded in 1948, Beijing-based Qing-Feng Steamed Dumpling Shop became a household name five years ago when Xi paid an unexpected visit to one of the chain’s restaurants in western Beijing. He ordered six pork and leek buns, some fried liver and green vegetables for a total of 21 yuan, according to the government-backed Beijing News.
The presidential patronage gave the business a boost. Huatian General Manager Zhu Yuling said that daily sales per store jumped 50% after Xi’s visit, the Beijing Youth Daily reported. The company went on to grow from a primarily local chain to one with national reach. Before Xi’s visit in 2013, it had only one restaurant outside Beijing — in bordering Hebei province.
By the end of 2017, there were 345 Qing-Feng restaurants across 12 provincial-level areas in China, according to the People’s Daily Report. In August 2017, Qing-Feng opened its first overseas location — in Almaty, the largest city in Kazakhstan.
During his brief lunch at Qing-Feng, Xi said that food safety must be made a priority. However, Qing-Feng hasn’t always been free of problems. In 2015, two of its restaurants in Beijing were temporarily shut down after diners found dead insects in their food. Last year, a customer complained that an order of dumpling soup delivered from Qing-Feng contained white bits that looked like insect eggs. The company later said that they were shrimp parts.
The investment in Qing-Feng is part of the government’s mixed-ownership reform, which many state-owned companies have undertaken, including telecom carrier China Unicom (China United Network Communications Group Co. Ltd.), which has brought in Alibaba Group Holding Ltd., Tencent Holdings Ltd., Baidu Inc., JD.com Inc. and Huawei Technologies Co. Ltd. as shareholders.
Contact reporter Coco Feng (email@example.com)
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