Xi (business)

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Xi (Chinese :) is a form of business organization in China where a group of companies are controlled by a private equity fund, forming an investment group. [1]

Definition

The term can be translated as business group or a conglomerate. [2] However there is a connotation in the term of bending the rules since the companies in the group while tracing to an owner are not affiliated as a neatly organized entity. [1] In a dissertation on the subject a Xiamen University student described the arrangement as follows:

"Very often strings of dysfunctional subsidiaries or intricately affiliated companies in the form “business groups” perform no substantial business activities other than acting merely as financial vehicles for one another. Spin-offs, shell-structures, holding companies are created at rapid rate..."

Comparison can be made to another, more formal kind of network based group structure in corporate China, the qiyejituan (simplified Chinese :企业集团; traditional Chinese :企業集團; pinyin :Qǐ yè jí tuán) in which the group of companies is registered as affiliated firms of a parent firm. [3]

Related Research Articles

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Mergers and acquisitions Type of corporate transaction

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Financial services

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Ping An Insurance

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Private-equity firm

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China Shipping Group

China Shipping Group Company, Limited, formerly China Shipping (Group) Company, is a former Chinese state-owned shipping conglomerate. It is now one of the intermediate holding company for another Chinese state-owned conglomerate, China COSCO Shipping, which is formed by a merger of China Ocean Shipping Company (COSCO) and China Shipping Group by the creation of a new parent company for the two conglomerates.

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China Hi-Tech Group Corporation, Ltd. (CHTC) is a Chinese conglomerate company. The company is owned by the Chinese Central Government via State-owned Assets Supervision and Administration Commission of the State Council (SASAC). The company main focus is on the textile industry. In June 2017, CHTC became a wholly owned subsidiary of Sinomach, another SASAC company, through a restructuring, as part of a plan to reduce the number of SASAC directly-controlled companies.

Jiangling Motors Corporation Group

Jiangling Motors Corporation Group Co., Ltd. (JMCG) is a Chinese state-owned holding mostly operating in the automotive industry. It was established in 1947 and is headquartered in Nanchang, Jiangxi.

References

  1. 1 2 China's Financial Markets: An Insider's Guide to How the Markets Work (1st ed.). Academic Press. 2006. p. 195. ISBN   0120885808.
  2. "The China "conglomerate" phenomenon and its effect on the capital market" (PDF). Xiamen University.
  3. Ma, Xufei. "The Critical Role of Business Groups in China". Ivey Business Journal (May / June 2005).