It’s true that desperate times call for desperate measures, but sometimes businesses can take this to the extreme. Take Hong Kong company Bright International, for example. The lighting manufacturer has decided that the competition in the lighting market is so tough that it needs to diversify, and for its latest foray it has chosen gold mining, agreeing to buy eight Chinese gold mines for just under US$1 billion. Some would say its a fair decision, after all the price of gold has remained stable during the financial crisis. Others would argue that its an overly ambitious move, given that lighting manufacturing and mining are so wildly different industries. Not that this has stopped Bright International before, last year they entered the timber industry after buying a mill in Guangdong. The company has not said how it intends to integrate these new businesses into its overall strategy, but investors don’t seem to care. The company’s shares rose 29% on Monday in response to the deal. Analysts aren’t buying it though, saying the deal is just an effort by the company to boost its share price. Australia’s Fortescue is probably feeling pretty desperate today as well. The mining company missed the deadline to raise US$6 billion in funding that was needed to a deal with the China Iron and Steel Association and Baosteel Group, to sell Chinese steel mills iron ore at a 3% discount. The company was hoping to use the money from that deal to expand and help it double exports by 2012. Speaking of expanding, Yan Qingmin, director of the Shanghai Branch of the China Banking Regulatory Commission said that Citigroup should try to expand its presence in China in the aftermath of the global financial crisis. He also praised the US government’s US$45 billion bailout of Citigroup last year, saying that support gave the banking industry much-needed confidence.
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