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China Nears Takeover of HNA Group as Virus Hits Business

  • Government of Hainan in talks to take control of indebted firm
  • Airline assets could be sold off to local players under plan
Bloomberg business news
China Said to Plan HNA Takeover as Virus Impacts Business
Updated on

China plans to take over indebted conglomerate HNA Group Co. and sell off its airline assets, the most dramatic step to date by the state to contain the deepening economic damage from the deadly coronavirus outbreak. HNA-related shares rose.

The government of Hainan, the southern island province where HNA is based, is in talks to seize control of the group after the contagion hurt its ability to meet financial obligations, according to people familiar with the plans. The once little-known airline operator shot to prominence between 2016 and 2017 after a debt-fueled acquisition spree saw it become the leading shareholder of iconic companies such as Hilton Worldwide Holdings Inc. and Deutsche Bank AG, while paying top dollar for properties from Manhattan to Hong Kong.