About three years after China started reining in an overseas acquisition spree by some of its home-grown companies, the binge all but ended. But not for Fosun Group.

The 27-year-old conglomerate, spanning insurance to mining and health care, has kept a low profile with relatively smaller purchases averaging less than $200 million since the start of 2018. The latest flurry of talks signals the empire, led by billionaire founder Guo Guangchang, is preparing to ramp up the size of the deals.

A consortium led by Fosun International Ltd. is in talks to buy a majority stake in a Russian gold miner, a transaction that could value the target at $1 billion, people familiar with the matter said this week. The company is also considering a joint bid for Bayer AG’s animal-health business, which could be valued at as much as $9 billion. Thomas Cook Group Plc has said it received an offer from Fosun for its tour-operator business.

Fosun is the last of the serial Chinese buyers still out chasing deals while others such as HNA Group Co. — once the most acquisitive local conglomerate — are pulling back, after a string of splashy acquisitions from Waldorf Astoria hotel to European soccer clubs invited Beijing’s scrutiny. Being a relatively smaller group, Fosun dodged the brunt of an ensuing crackdown, and shifted its focus to deals that fit better into its core businesses.

“With the withdrawal of other large conglomerates, clearly they see an opportunity,” said Andrew Collier, a Hong Kong-based managing director at Orient Capital Research Inc. “They also may have got approval from within the country as long as they are in sectors of use to the country, which would include commodities and health care.”

Fosun is a part of a group of four private Chinese giants — others being being HNA, Dalian Wanda Group Co. and Anbang Insurance Group Co. — that were targeted in China’s deleveraging campaign. Authorities grew wary of capital outflows and debt used to fund the transactions, following a historic credit expansion in the aftermath of the global financial crisis.

HNA, which started as a little-known airline operator, shot into prominence this decade by spending more than $40 billion on acquisitions across six continents starting 2016 in a breathtaking spree, including stakes in Hilton Worldwide Holdings Inc. to Deutsche Bank AG. Wanda, led by billionaire chairman Wang Jianlin, acquired assets in Hollywood such as AMC Entertainment Holdings Inc. and Legendary Entertainment LLC. Anbang made global headlines in 2014 with the trophy purchase of New York’s Waldorf Astoria hotel.

18-Year Prison

Within a few years, many of those deals unraveled. HNA founder and Chairman Chen Feng told Caijing in November that his group had sold about $45 billion of assets in 2018. Wanda has disposed of property in Beverly Hills and European soccer clubs. Anbang was temporarily seized by China’s insurance regulator last year and its former chairman Wu Xiaohui was sentenced to 18 years in prison for fraud.

Representatives for Fosun, Wanda and Anbang didn’t respond to requests for comments, while HNA declined to comment.

Fosun International itself bought about $22 billion of assets overseas since the start of 2012, according to data compiled by Bloomberg. Allaying concerns the group is snapping up anything going cheap instead of adding quality holdings, executives said in 2016 that Fosun is different because it gets more involved in making strategic decisions in the companies it invests in.

For instance, after acquiring control of Club Med SAS in 2015 following a protracted takeover battle, Fosun revived the fortunes of the once flagging resorts brand by bringing Chinese customers. Now Club Med is the crown jewel of its tourism and leisure business. It also owns a stake in Canadian performance art group Cirque du Soleil and 18% of Thomas Cook.

Turbulent Times

After the spree, Fosun went through some turbulent times as well. A brief disappearance of Chairman Guo in December 2015 caused shares of the group companies to tank, triggering a halt to trading after they lost as much as $3 billion in market value. The news came at a time of heightened scrutiny as part of President Xi Jinping’s biggest crackdown on graft since the republic’s founding in 1949.

Following the turmoil, Fosun set out to become leaner in 2016, with some asset disposals of its own. Among the sales by Fosun included Ironshore Inc. in December 2016. The Chinese company had bought the Bermuda-based property and casualty insurer only the previous year. Some of the assets Fosun still owns are the Wolverhampton Wanderers Football Club in the U.K. and Studio 8, a filmmaker.

Having more than halved its net debt in the last two years to 21.9 billion yuan ($3.2 billion) as of end-2018, Fosun has been lately focusing mostly on hospitality, health care and finance, businesses Guo says are linked to happiness, health and wealth.

The group is targeting to grow into an empire with a market value of $100 billion, compared with about $22 billion now for its three Hong Kong-listed units. That makes the latest round of planned acquisitions crucial. The last time Fosun announced a billion-dollar takeover was almost three years ago, when it agreed to buy Gland Pharma Ltd. in India, data compiled by Bloomberg show.

“Chinese buyers are becoming more rational in making their acquisition decisions,” said Leon Qi, regional head of Asian Financials Research at Daiwa Capital Markets Hong Kong Ltd. “They pay more attention to business synergies and returns of these assets, while for a few years they had been chasing some big names for reputation.”

Credit Rating

Still, the ride may not be smooth. Uncertainties in the European Union including Brexit and China’s regulations on capital outflows could hamper Fosun’s plans. It also needs to boost its credit rating. Despite the reduction in Fosun’s debt, its U.S. dollar bonds are rated two notches below investment grade by S&P Global Ratings, potentially making it more expensive to fund these acquisitions.

“I don’t think they are out of China’s scrutiny, no one really is,” said Jin Rui Oh, a Singapore-based analyst at United First Partners. “But these are not multibillion deals financed out of heavy borrowings, and also non-U.S.-based.”

In a shift of strategy amid the trade war, Fosun is easing up on investments in the U.S. and pivoting toward emerging markets and Europe. Last year, it acquired a majority stake in French fashion house Lanvin and paid about $44 million for a controlling stake in Guide Investimentos, a Brazilian brokerage.

Fosun International’s major advantage is its revenue mix, said Daiwa’s Qi. Almost half of the company’s sales come from overseas, providing it the buffer needed for the acquisitions.

“There’s minimal funding mismatch, and that reduces the chances of cross-border fund flow,” a risk authorities were concerned about, Qi said.

–With assistance from P R Sanjai, Dave McCombs, Jinshan Hong and Zhang Dingmin.