Liang Xiaolei’s first forays into business were with his father Liang Guangfu, a former military man. In 1995, they established Linhai Evergreen Artware, which started out producing and exporting decorative lights (the kind used on Christmas trees) before expanding into electrical tools and travel equipment. Their next venture was a retail business that quickly expanded to 110 outlets.
Setting sail
Having accumulated a significant amount of capital, Liang Xiaolei started to think about business on a larger scale: in particular, he wanted to invest in an industry with high entry barriers. His decision to enter shipbuilding led to the creation of SinoPacific Shipbuilding Group. In 2003, he purchased Zhejiang Shipyard, a state-owned shipbuilding company in Ningbo. This was followed a few months later with the acquisition of Jiangyang Shipyard in Yangzhou, a defunct facility that cost Rmb139 million ($21 million), which was renamed “Yangzhou Dayang Shipbuilding”
The timing was good, as the industry was starting to recover from a cyclical downturn. By 2007, his firm was one of the world’s top 50 shipyards by orders. Liang’s ambition is for it to become one of the world’s most efficient with an annual output of 40 vessels.
Growth
The Chinese shipbuilding industry has traditionally been dominated by two large state-owned companies, CSSC and CSIC, that produce large-scale ships like bulk carriers and oil carriers. Liang therefore decided to focus on a more specialist offering, with each yard focusing on a different kind of ships. Hence Zhejiang shipyard is now the world’s largest producer of offshore support vessels (boats used to provide services to offshore energy facilities) and the Dayang yard concentrates on vessels used to transport liquified natural gas. In 2010, SinoPacific’s profits exceeded Rmb1 billion and Liang is preparing the company for a domestic listing. Although he has not disclosed the amount he intends to raise, he has said that the capital will be used to fund organic growth rather than acquisitions. Liang Xiaolei’s family is worth Rmb8 billion, according to the 2010 Hurun Rich List, ranking 118th.
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