On August 28, FOSUN INTL (00656.HK) announced that it has applied to the Hong Kong Stock Exchange for approval to spin off its subsidiary Club Med Lifestyle Group (Mediterranean Resort Group) for an independent listing on the main board. On the same day, the Mediterranean Resort Group submitted its listing application to the Hong Kong exchange, with BNP Paribas, HSBC, and JPMorgan serving as joint sponsors. The group operates under the flagship brand Club Med, marking what could be described as a "re-listing" of Fosun's cultural tourism business.

Club Med was founded in France in 1950. In September 2014, FOSUN INTL led an investor consortium in launching a voluntary public tender offer for the company at EUR 24.60 per share, subsequently acquiring the remaining minority interests through a squeeze-out process at a total privatization cost of approximately EUR 916 million. In March 2015, Club Med SAS, the operating entity of Club Med, became wholly owned by Club Med Invest and was delisted from Euronext Paris, becoming an indirect subsidiary of FOSUN INTL. Subsequently, Fosun Tourism Culture Group (01992.HK), which housed Club Med, was separately listed in December 2018. On March 17, 2025, Fosun Tourism Culture completed its privatization and was delisted from the Stock Exchange. Roughly 18 months later, Fosun has repackaged its resort and vacation scenario service assets into the Mediterranean Resort Group, once again targeting a Hong Kong listing.

Revenue Growth Over Three Years, Yet Profits Decline Steadily

According to the prospectus, Club Med is one of the few high-end all-inclusive resort brands with a global footprint. Leveraging over 75 years of brand heritage and global operational expertise, the company has built a sales network spanning six continents and more than 40 countries and regions, offering products across diverse scenarios such as mountain skiing and sunny coastal destinations. As of the latest practicable date, the company operates 69 premium resorts worldwide. Citing CIC Consultancy data, the prospectus shows that by 2025 turnover, Club Med is the world's largest resort brand and the largest all-inclusive resort brand, with market shares of 1.1% and 5.3%, respectively. Under the same metrics, Club Med is the largest resort brand in Europe, Middle East, Africa, and the Asia-Pacific region, and one of the top five resort brands in the Americas. By number of resorts in 2025, Club Med is the world's largest mountain ski resort brand and the only all-inclusive resort brand operating across all four major global ski destinations.

In terms of financial performance, the prospectus reports that from 2023 to 2025, the Mediterranean Resort Group's revenue stood at EUR 1.862 billion, EUR 1.923 billion, and EUR 1.949 billion, respectively, with year-on-year growth of 3.3% and 1.3% in 2024 and 2025. In the first half of this year, the group recorded revenue of EUR 1.083 billion. On profitability, the group's gross margins for 2023 to 2025 were 28.9%, 29.2%, and 30.3%, respectively, rising to 34.7% in the first half of this year. Adjusted EBITDA margins for 2023 to 2025 were 19.5%, 20.4%, and 20.2%, reaching 24.5% in the first half of 2026.

Breaking down revenue, the Mediterranean Resort Group derives its income primarily from Club Med resort operations and vacation scenario services. Nearly all revenue comes from Club Med resort operations: in 2025, this segment generated approximately EUR 1.939 billion, up 1.6% year-on-year, accounting for about 99.5% of total revenue. Vacation scenario services contributed approximately EUR 9.7 million, down 33.3% year-on-year, representing about 0.5% of total revenue. From 2023 to 2025, the number of guests hosted at Club Med resorts was 1.518 million, 1.532 million, and 1.59 million, respectively, with 830,000 guests in the first half of 2026. Occupancy rates by bed stayed around 62% (68.5% by room in the first half of 2026), while the average daily bed price rose from EUR 220 in 2023 to EUR 235 in 2025, further climbing to EUR 261 in the first half of 2026.

However, it is worth noting that, in stark contrast to the improving gross margins and sustained high EBITDA margins, the company's net profit has declined sharply year after year during the track record period: from 2023 to 2025, the group's profit for the year (net profit) was approximately EUR 68.768 million, EUR 29.604 million, and EUR 10.917 million, respectively, with year-on-year declines of 57% and 63.1% in 2024 and 2025. Net profit attributable to the parent company was approximately EUR 63.746 million, EUR 28.591 million, and EUR 8.918 million, respectively, falling 55.15% and 68.81% year-on-year in 2024 and 2025. The disparity stems largely from tax burdens. According to the prospectus, profit before tax for 2023 to 2025 was EUR 69.010 million, EUR 45.118 million, and EUR 59.304 million, while income tax expenses were EUR 242,000, EUR 15.514 million, and EUR 48.387 million, respectively. The group explained that in 2023 and 2024, it utilized and recognized a high proportion of prior-year tax losses and temporary differences, whereas in 2025, certain entities generated higher taxable profits, leading to a significant increase in the effective tax burden. Additionally, financing costs remained above EUR 100 million throughout the track record period (EUR 111 million, EUR 116 million, and EUR 103 million for 2023 to 2025), further eroding net profit.

Notably, the group's gearing ratio (net debt/total assets) declined from 54% in 2023 to 51.1% in 2025, before rebounding to 64.1% in the first half of 2026. Company directors stated that, taking into account cash on hand, internally generated funds, and available bank credit, the company has sufficient working capital to meet its needs for the next 12 months and plans to optimize its financing structure through measures such as repaying short-term bank loans. In terms of cash flow, net cash generated from operating activities was EUR 389 million, EUR 374 million, and EUR 412 million for 2023 to 2025, and EUR 179 million in the first half of 2026.

Expansion to Approximately 85 Resorts by 2030, with Increased Focus on AI and Digitalization

The prospectus states that Club Med's core competitiveness rests on three mutually reinforcing pillars: first, the premium all-inclusive model; second, the unique G.O. (Gentils Organisateurs, or Gracious Organizers) culture; and third, global customer sourcing and direct sales capabilities. The Mediterranean Resort Group engages guests through an omnichannel sales platform, with direct sales channels contributing more than 70% of turnover during the track record period. Operationally, the group runs resorts through three models: owned, leased, and managed. Among the 69 Club Med resorts globally, 8 are operated under the owned model along with one cruise ship, 41 under lease agreements, and 19 under management contracts.

Strategically, the Mediterranean Resort Group plans to accelerate its presence in scarce global tourist destinations, including the Alps, Southern Mediterranean, North Africa, Northeast Asia, Southeast Asia, North America and the Caribbean, and South America, while also exploring emerging markets such as the Middle East. It aims to expand its global resort network to approximately 85 properties by 2030. In July 2026, Club Med's beach and safari resort in South Africa commenced operations, marking the company's entry into the South African market. In August 2026, construction began on a new resort on Koh Samui in Thailand. Additionally, Fosun indicated that, leveraging Club Med's brand influence and global operational capabilities, the Mediterranean Resort Group is expanding vacation scenario services under a light-asset model, continuously building a diversified resort lifestyle. In terms of market scale, the global resort lifestyle market is projected to grow from USD 2.5 trillion in 2025 to USD 3.5 trillion by 2030.

On AI and digitalization, the Mediterranean Resort Group stated that in July 2026, it entered into a strategic cooperation agreement with a leading AI technology solutions company to advance its "Happy Digitalization" AI strategy, focusing on enhancing customer experience through AI, strengthening cloud and native AI capabilities, and supporting global business growth. According to the prospectus, Club Med intends to allocate the proceeds from the Hong Kong IPO to three areas: business development to support the goal of expanding to approximately 85 resorts by 2030; optimizing the company's capital structure; and general working capital and general corporate purposes to support daily operations and development. Fosun stated that if the proposed listing is completed, the raised funds are intended for expanding the global resort network, upgrading resort products, building digital and AI capabilities, with the remainder used to optimize the capital structure and daily business operations.

Xu Xiaoliang, chairman of the Mediterranean Resort Group, commented: "Submitting this listing application in Hong Kong marks an important moment for Fosun's tourism business to move toward value creation. Going forward, we will leverage Club Med as our flagship brand, accelerate the development of high-quality global resort experiences, and make joyful vacations a lifestyle that transcends borders, realizing the vision that 'vacations make life better.'"