Mining, metals, insurance
Saturday afternoon following soccer and baseball, we ran our normal errands, like grocery shopping at an imported food store in Shunyi. The shopping plaza's parking lot is often full of vendors selling products and services with the local well-off and/or expatriate populations in mind. We normally don't pay them much mind, except to be frustrated by their booths taking up convenient parking spaces. One booth this weekend, though, I could not ignore and had to explore. It was a health insurance company, offering very comprehensive (and very expensive) packages. What especially caught my attention was the name of the insurer.
AXA-Minmetals Assurance. Wait, Minmetals?
More after the jump
Minmetals is a company whose name I usually associate with mining and commodity metals. They are also one of the big players in rare earth mining and processing in China. Just last week it was announced what export quota China Minmetals would be held to for the first half of this year. It wasn't obvious to me how Minmetals could make the leap from metals to health insurance, and expensive insurance at that. Even if I tried to broaden my understanding to include what I considered to be Anything-is-Possible-in-China, I still could not make that leap.
I even asked the AXA-Minmnetals representatives how Minmentals came to be involved in insurance. They replied to me, natutally, that it was because of the joint venture with AXA. Yes, I could see that AXA and hyphen on the brochures, but still, why Minmentals?
Randy mentioned to me as we were leaving how there were American companies that similarly diversified away from their more industrial roots and core products. GMAC, he pointed out, provided more than just financing for General Motors vehicles. He once had a mortgage with GMAC. To this I countered that GMAC owes its original existence to General Motors wanting to increase auto sales by providing their own loans. How that business unit then grew into the family of GMAC companies today does not take a lot of imagination. GE Capital is another such entity. Minmetals, though, has branched into insurance (and high-end international insurance) because.....ummm.....
Minmetals probably has the money, and the connections, to allow AXA to operate in China. But how this came about--a State-Owned-Enterprise (SOE), primarily in the mining and metals businesses, forming a joint venture with a French Insurance company to create another insurance company for expats---yeah, I don't get it. I just don't get it. I wonder how these two disparate organizations came together. Who approached whom?
China really challenges my understanding how business works.
AXA-Minmetals Assurance. Wait, Minmetals?
More after the jump
Minmetals is a company whose name I usually associate with mining and commodity metals. They are also one of the big players in rare earth mining and processing in China. Just last week it was announced what export quota China Minmetals would be held to for the first half of this year. It wasn't obvious to me how Minmetals could make the leap from metals to health insurance, and expensive insurance at that. Even if I tried to broaden my understanding to include what I considered to be Anything-is-Possible-in-China, I still could not make that leap.
I even asked the AXA-Minmnetals representatives how Minmentals came to be involved in insurance. They replied to me, natutally, that it was because of the joint venture with AXA. Yes, I could see that AXA and hyphen on the brochures, but still, why Minmentals?
Randy mentioned to me as we were leaving how there were American companies that similarly diversified away from their more industrial roots and core products. GMAC, he pointed out, provided more than just financing for General Motors vehicles. He once had a mortgage with GMAC. To this I countered that GMAC owes its original existence to General Motors wanting to increase auto sales by providing their own loans. How that business unit then grew into the family of GMAC companies today does not take a lot of imagination. GE Capital is another such entity. Minmetals, though, has branched into insurance (and high-end international insurance) because.....ummm.....
Minmetals probably has the money, and the connections, to allow AXA to operate in China. But how this came about--a State-Owned-Enterprise (SOE), primarily in the mining and metals businesses, forming a joint venture with a French Insurance company to create another insurance company for expats---yeah, I don't get it. I just don't get it. I wonder how these two disparate organizations came together. Who approached whom?
China really challenges my understanding how business works.
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