Treading boldly: China's Ren builds global chemicals group
By Chen Aizhu and Matthew Miller
BEIJING (Reuters) - Ren Jianxin, the architect behind China National Chemical Corp's $8 billion bid for Italian tiremaker Pirelli PECI.MI, is rare among Chinese state company bosses: he gets the importance of markets and the limits of government assistance.
ChemChina's 57-year-old chairman, who agreed last week to buy the world's fifth-largest tiremaker, sees himself as an "industrialist" and not as a politician - a route taken by many senior state-enterprise officials.
Over three decades, Ren has led the restructuring of China's chemicals industry, organizing more than 100 firms under the ChemChina banner into six main operating divisions, producing everything from basic chemicals to fertilizers and silicones. Along the way, he also founded the Malan Noodle Co, a popular restaurant chain.
His biggest gambit, though, has been to globalize ChemChina through acquisitions aimed at bringing international brands and professional management to China. Since 2006, he has spent about $4.4 billion on firms in Australia, France, Norway and Israel. In 2007, Ren also sold a 20 percent stake in Bluestar, his specialty chemicals arm, to private equity firm Blackstone (BX.N: Quote) for $600 million.
For Ren, the key is to make ChemChina more competitive.
Despite increasing revenue by nearly a quarter last year to around 300 billion yuan ($48.3 billion), earnings in the rubber and oil and gas businesses have been squeezed by oversupply and falling prices. Those same market factors in 2012 forced Oslo-based Elkem, a $2 billion acquisition, to halt solar grade silicon production for 16 months.
"For all these years ChemChina has been battling with market turmoil," Ren told a small group of reporters on Sunday.