Shanghai’s Gui in Kidman has deep cred with China

Gina Rinehart’s Chinese partner in the $360m purchase of S. Kidman & Co is Shanghai CRED, managed by Gui Guojie.

The AFL’s Gillon McLachlan, Malcolm Turnbull, Gui Guojie, Port Adelaide’s Keith Thomas. Picture: Stephen Cooper

Gina Rinehart’s Chinese partner in the $360 million purchase of S Kidman & Co is Shanghai CRED, managed by Gui Guojie, an affable property developer who has also been assigned by the Chinese government a major role in linking state and private companies, and in building Chinese investments overseas.

He has gained substantial credibility in Australia through his $3m, three-year commitment to Port Adelaide Football Club.

His company was involved in two previous Chinese-led bids for Kidman as a smaller player, but took a new approach two months ago, underlining his persistence.

Mr Gui is a member of the ruling communist party, and of Shanghai’s Chinese People’s Political Consultative Conference.

The company, that now has 33 per cent of the new ownership structure of S Kidman, was originally, until its privatisation, the Shanghai branch of China National Real Estate Development — the CRED Group — owned by the State Council, China’s cabinet.

The State Council founded CRED in 1981 to pioneer the commercialisation of the real estate industry.

From 1977 to 1988, Mr Gui was the director of housing administration in Shanghai’s Hongqiao district, before becoming deputy general manager of Shanghai CRED and then in 1997 its general manager, which remains his chief title.

Shanghai CRED — whose assets were reported this year as worth $3.2bn — has more than 20 affiliated companies, whose activities include small loans, housing renovation and e-business.

Mr Gui — who yesterday did not answer calls — led the privatisation of the Shanghai branch of CRED, although the details remain confidential.

Ten years ago, Shanghai CRED joined Guangcai 49 China Shareholding Company, an alliance of 49 major private companies under the China Society for the Promotion of the Guangcai Program. This society, which operates charity programs, was jointly set up by The United Front Work department of the Chinese Communist Party and the All-China Federation of Industry and Commerce.

Mr Gui was re-elected in January as one of the board directors of Guangcai 49 China, headquartered in Beijing.

The major goals of Guangcai 49 China are listed on its website as actively co-operating with state-owned enterprises in their reform, and operating as a platform to integrate private enterprises with the major projects of government, and to encourage private companies to invest abroad.

Wang Zhaoguo and Liu Yandong, members of China’s most powerful body, the Politburo Standing Committee, have chaired Guangcai 49 China in the past, and the present chairman is Du Qinglin, minister of the United Front department of the party.

Shanghai CRED’s international involvements have been focused on Australasia.

In 2011 it bought a 1100ha estate, Peppers Carrington, near Auckland in New Zealand, for $27m — which includes a golf course and vineyard.

At that time, the NZ authorities recorded Shanghai CRED’s ownership as Mr Gui with 36 per cent, Zhan Pei 25 per cent, and unnamed “others” 39 per cent.

Shanghai CRED earlier this year acquired eight farming properties in the Goldfields, Kimberley, and Wheatbelt in Western Australia, for about $20m.

South Australian Premier Jay Weatherill said, after dining with Mr Gui during a visit to China six months ago: “Mr Gui is a billionaire; he’s already invested substantially into Australia. Business is really pretty simple at the end of the day — it’s people doing business with other people. To get a deal, you first need trust; to get trust, it needs to spring from a relationship, and what better way to build a relationship than sharing a love of a sporting event.”

Mr Gui is not rated among China’s 1500 richest people by the Shanghai-based Hurun Report, the most highly respected Chinese wealth listing. In May next year, Mr Gui will help sponsor in Shanghai a Port Adelaide AFL game as his “gift” to his own city.

additional reporting: Zhang Yufei