BANGKOK Dec 6 Thailand's wealthiest tycoon,
Dhanin Chearavanont, can trace his business empire to China's
bustling Guangdong province in the 1920s, when his father left
for Thailand to set up a seed company in Bangkok's Chinatown.
Nearly a century later, their family-run conglomerate,
Charoen Pokphand Group (CP), is returning to its Chinese roots
in a bold $9.38 billion deal to buy HSBC's 15.6 percent stake in
China's No.2 insurer, Ping An Insurance, Asia's
second-largest deal this year.
For Dhanin, the 73-year-old patriarch of the agri-industrial
group, the investment marks a natural progression in a business
strategy that has tilted towards China for three decades. But it
nonetheless marks a bold new chapter for a company best known as
Thailand's largest feedmeal and poultry producer.
"China is important for CP and the deal will open ways for
the group to expand in the country," said an investment banker
who declined to be identified. "The insurance business is hot
and China has a low penetration rate, which provides growth
Insurance is not an obvious fit for a group that, through
its flagship Charoen Pokphand Foods, is the world's
biggest shrimp farmer and top maker of animal feed. CP Foods
also operates CP Fresh Mart food shops.
But it has long had its eye on China. Known as Chia Tai in
China, the unlisted CP was the first multinational company to
invest in the country's agribusiness industry in 1979.
Under Beijing's latest five-year plan, it was tasked with
helping to modernise China's farm sector. It runs a finance
business through Zhengxin Bank and also operates Lotus
supermarkets in Shanghai, according to the company's website.
Dhanin, Forbes Asia's Businessman of the Year in 2011 with
assets of $9 billion, was ranked as China's number one foreign
business leader in a 2009 poll by Chinese Economic Weekly.
The youngest son of the Thai-Chinese family, he has been at
the helm of the business since the age of 30, turning it into a
multinational operation by expanding its ventures in farming,
retail and telecommunications.
His father, Chia Ek Chor, and his uncle, Chia Seow Hui, had
left Guangdong in 1921. In 1946, their seed shop was renamed
Charoen Pokphand, which means "prosperity of consumers" in Thai,
and their business diversified across Asia via a number of
enterprises and contract farming.
CP Group branched out from seed into feed, farms, grain
trading and feed mills.
"I'm confident in the power of Asia, which will play a more
significant role in the world's trade," Dhanin said at the 12th
Forbes Global CEO Conference in Dubai in October.
China is already a major investment base for CP Group, which
operates 109 animal feed plants spread through 29 of the
mainland's 31 provinces. It also has auto, medical, machinery,
retail and property interests.
CP Group, which aims to be "the Kitchen of the World",
recently formed a joint venture with Japanese food-chain
operator Yoshinoya to open beef-bowl restaurants in China.
Dhanin, also Chairman of CPF, has five children and his
youngest son, Supachai Chaeavanont, controls True Corp
, Thailand's only fully-integrated telecoms service
Dhanin is known to be fascinated by traditional Thai
cockfighting and has a special centre to preserve native breeds
in the eastern province of Chon Buri.
(Reporting by Khettiya Jittapong; Editing by Alex Richardson)