Equipment leasing was a fledgling industry in China when Alta CEO John C. Deane first addressed business audiences there in the late 1980s. Two recent conferences in China highlight the industry’s rapid growth in recent years, the upswing in investors, and interest from Chinese leasing companies and their stakeholders in going global, Deane observed.
Alta professionals from the U.S., Europe and Alta’s firm in China, CapSol Management Consultants, were deeply involved in both events, which attracted a total of nearly 350 attendees.
China’s equipment leasing and finance market has expanded thirty-fold during the last five years, according to conference organizers, with an estimated US$ 300 billion portfolio and more than 800 bank-affiliated, industrial-affiliated, captive and independent leasing companies participating. China’s continuing efforts to transform its equipment manufacturing industry, economic structure and financial markets are major drivers behind the equipment leasing market’s sustainable growth
On Sept. 24 in Shanghai, CapSol, China Business Network and Alta sponsored the 1st Investment Conference on China Equipment Leasing & Finance with the theme “From Cocoon to Butterfly.” Conference leaders analyzed investment opportunities, challenges, appropriate capital strategies, and successful business models.
“A significant percentage of those attending were firms actively investing in the equipment finance and leasing industry,” Deane noted. “There was also considerable interest from the Chinese leasing industry and its stakeholders in going global through investment opportunities and the support of Chinese equipment sales in other regions.”
Jason Zhou, managing partner of CapSol, discussed the features and outlook of China’s equipment leasing industry from a global perspective. Deane addressed business model innovation and investment opportunities in international equipment finance markets. Chris Boobyer, a partner with Invigors EMEA, which is The Alta Group in Europe, the Middle East and Africa, spoke about the performance of equipment finance in global capital markets.
Wang Yi, a financial advisory consultant for CapSol and former chairman of BOC Aviation, used his former company as a case study to discuss mergers and acquisitions in equipment finance. Yankai Qu, a CapSol partner leading the firm’s professional development, who is also the former president of the China Leasing Association, was the moderator for the conference and its final roundtable on investment opportunities and exit strategies.
The following day in Shanghai, the 2013 International Equipment Leasing and Finance Forum was held, sponsored by CapSol, China Business News, Citi Capital and Alta. The forum focused on leasing’s impact in reshaping business models for equipment manufacturing, one of China’s most important industries.
“Equipment manufacturers in China have come to realize that providing customers with financing options is imperative in order to maintain growth objectives,” said Paul W. Frechette, a senior managing director of Alta, who addressed the conference about business models for utilizing equipment leasing in manufacturing.
“Certainly this is true for customers located in China. During the two conferences, we met with many of these manufacturers who also realize the need to grow business outside of China, and who have an interest in assisting customers with financing in the U.S., Latin America, Europe, and elsewhere in the Asia Pacific region.”
Conference organizers noted that the event was held at a critical time, with China’s equipment leasing and finance industry at the “tipping point” of specialization and globalization
Other Alta speakers included Zhou, who discussed equipment leasing global experiences and practices in China; and Richard Guilbert, a partner with Invigors EMEA, who participated in a roundtable forum on how equipment leasing supports business transformation and global expansion in equipment manufacturing.
“In order to accomplish growth in equipment financing for customers, the larger Chinese manufacturers are embarking on bringing professional training to their employees responsible for customer financing activities,” Frechette added. “CapSol and Alta have been hosts for some of this training, in the U.S. and China, and we see a considerable interest from the conference participants in expanding training curricula in 2014.”