A state-owned Chinese bulldozer manufacturer has purchased a 75 per cent stake in Italy’s troubled Ferretti Group, symptomatic of the visible shift of power from West to East.

Jinan-based Shandong Heavy Industry Group paid €374 million ($474 million) for the world’s largest luxury yacht maker, according to a statement from Ferretti. This included an equity investment of 178 million euros and provision of debt financing of €196 million which will be paid to the firm’s creditors.

SHIG-Weichai Group will acquire the interest in the yacht maker after the completion of the debt restructuring procedures, while existing creditors will acquire the remaining 25 per cent interest in Ferretti through a €25 million equity injection and debt to equity swap.

"Developing the yacht business is one of the group’s strategic goals for the next five years," said Tan Xuguang, chairman of SHIG—Weichai Group, in a statement.

"Ferretti, which possesses iconic international brands, state-of-the-art manufacturing technologies, products of the highest quality and an extensive sales network, is an ideal partner. Through the acquisition, the group will cooperate closely with this world-renowned yacht maker, providing Ferretti with new channels to market and capital support as well as other resources with which it can expand more effectively into emerging markets, a key area of potential growth for Ferretti,” he said. 

In China, where the number of millionaires is set to grow to 1.4 million with $8.8 trillion by 2015, according to Julius Baer, there is a nascent market. There is also growing demand from wealthy Chinese for trophy assets like art, wine and yachts. 

“China is one of the most rapidly developing countries for the yachting sector and has great potential for the coming five to ten years”, said Norberto Ferretti, chairman and founder of Ferretti Group.

Ferretti Group was left almost bankrupt after the recession dried up appetite for super luxury yachts and sales dived, and had to be rescued by a group of 100 creditors led by The Royal Bank of Scotland, which restructured its debt. 

Ferretti's boats have sold to the likes of Brigitte Bardot and Sean Connery and can retail for upwards of €100 million.