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Eric Ng

Two top executives of HNA Group have been detained by China’s police, days after one of the country’s largest private conglomerates was broken down into four separate businesses following its bankruptcy restructuring.
HNA’s founder and former chairman Chen Feng, and the former chief executive Adam Tan Xiangdong have been detained by police on “suspected crimes,” the group said in a statement in its official WeChat account. “HNA Group and its member enterprises are operating in a stable and orderly manner. The [company’s] bankruptcy restructuring is going smoothly and its production and operations have not been affected.”
The detentions bring the curtains down on HNA, built on the foundations of China’s most successful private carrier Hainan Airlines.
With a handful of aircraft, the carrier – with an early investment from the American financier George Soros – quickly built a business flying holiday makers and Russian tourists from China’s frigid north to the country’s sole tropical island, long regarded as “China’s Hawaii” for its beaches, azure waters and holiday resorts.

Over three decades, HNA ballooned from a regional airline into one of China’s largest private enterprises and most profligate asset buyers. Much of the growth, fuelled by bank borrowings, took place after 2010 when Chen set the goal for HNA to make it among the Fortune 100 companies, ranked by assets.
At its peak, HNA’s estimated US$50 billion of assets spanned the globe, from the largest stake in Deutsche Bank to a quarter of Hilton Hotels and Resorts, to a land parcels at Hong Kong’s former Kai Tak airport. The asset shopping spree landed HNA with 500 billion yuan (US$77.3 billion) of debts, according to Gu Gang, executive chairman and the head of the working committee responsible for untangling the group’s businesses.
After a meeting with 2,700 key officials of the group who took part in person or via video link, Gu said they must strengthen their cohesion and follow guidance from the Communist Party.
“HNA’s bankruptcy restructuring is at its last stages,” he was quoted as saying in a company statement. “Each business unit must review the hard lessons learned from its past 28 years of development. We must understand that it was the party and the nation that has given HNA the chance to be reborn, and follow the instructions of the party.”
Chen was still listed on HNA’s website as chairman and Tan as CEO on Friday evening. The company’s statement did not specific the crimes committed by the two executives.

Under HNA’s restructuring, the group will be divided into four parts, with each unit operating independently in aviation, airport, financial and commercial, according to a restructuring blueprint unveiled over the weekend.
Hainan Airlines will receive a strategic investment from Liaoning Fangda Group Industrial, a conglomerate with business in the carbon, steel and pharmaceutical sectors.
HNA raised eyebrows in Hong Kong for overpaying for land in late 2016 and early 2017. Over four months, the company paid HK$27.2 billion (US$3.5 billion) for four plots at Kai Tak, breaking records along the way, to build waterfront luxury flats.
After falling into financial difficulties, it was forced to sell them all. It made a gain of HK$2.54 billion on the first three, but suffered a HK$740 million loss on the last plot.

HNA also owns Hongkong Airlines, which had to axe over 1,000 jobs, made steep pay cuts after the coronavirus pandemic hit the travel industry hard. It was also served a couple of lawsuits in April and May this year over alleged non-payments.
HNA Group was one of four Chinese conglomerates that were placed under scrutiny for their debt-fuelled asset acquisitions, along with Anbang Group, CEFC Group and Dalian Wanda Group.
Anbang was nationalised in February 2018 and its former chairman Wu Xiaohui was sentenced to 18 years in jail for fraud and embezzlement. The insurance company, since renamed Dajia, is seeking investors to take it over from the government.


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HNA Group

Police detain HNA’s founder Chen Feng, CEO Adam Tan days after breaking one of China’s biggest conglomerates into four units

Chen Feng, founder of China's Hainan Airlines and the HNA Group during an interview in Haikou on 23 June, 2017. Photo: Xiaomei Chen

A HongKong Airlines aircraft is seen at Hong Kong International Airport, Chek Lap Kok. PHOTO: HANDOUT

A Hainan Airlines aircraft sits on the tarmac at the airport in Beijing, China May 13, 2018. Picture taken May 13, 2018. REUTERS/Stringer ATTENTION EDITORS - THIS IMAGE WAS PROVIDED BY A THIRD PARTY. CHINA OUT.

Adam Tan Xiangdong, chief executive officer and co-founder of HNA Group Co., pauses during the Caijing Annual Conference in Beijing, China, on Tuesday, Nov. 28, 2017. HNA is considering asset sales after financing costs at the acquisitive Chinese conglomerate surged to levels beyond what the company could cover through its earnings. Photographer: Giulia Marchi/Bloomberg

graphic for online Land sales by government tender in Kai Tak area Land price Date Site/Development (H K$b) 0 Jun 2013 One Kai Tak Feb 2014 Victoria Skye Feb 2014 K City 0 Feb 2014 Vibe Centro May 2014 Oasis Kai Tak 0 Nov 2016 Area 1K Site 3" Nov 2016 Area 1E Site 2 0 Dec 2016 Area 1L Site 3" 0 Dec 2016 K Summit Jan 2017 Monaco e Mar 2017 Area 1L Site 2" e Mar 2017 Upper Riverbank May 2017 Airside May 2018 Area 1F Site 1 e Nov 2018 Area 4B Site 3 e Jul 2020 Area 4B Site 4 e Dec 2018 One Victoria 0 Jan 2019 Area 4C Site 3 e Jan 2019 Area 4C Site 5 e Mar 2019 Area 4B Site 1 e May 2019 Area 4C Site 2 e May 2019 Area 4C Site 4" e June 2019 Area 4C Site 1 e July 2019 Area 4A Site 1 e Aug 2019 Shing Kai Road next to the Kai Tak Sports Park 02:, Sep 2019 Area 4C Site 4 e Sep 2019 Area 4A Site 2 May 2020 Area 2A, 4, 5B & 10 e Dec 2020 Area 4E Site 1 Feb 2021 Area 4E Site 2 Price/sq ft (HK$) Developer(s) Gross floor area (sq ft) 4.54 5,157 China Overseas Land & Investment* 880,280 2.91 5,600 K&

HNA Group to be broken into four independent units as Chinese conglomerate’s restructuring enters final stretch

HNA Group’s restructuring is slowly taking shape. Photo: Imaginechina via AFP

Chen Feng, Chairman of China's Hainan Airlines, poses for a picture in Haikou. 23JUN17 SCMP / Xiaomei Chen

Gu Gang, executive chairman of HNA.  Photo: Handout

China’s government is poised to take over HNA Group as coronavirus outbreak grounds airline fleet, scuppers business

HNA Group’s logo on its corporate head office building in Beijing on February 2016. Photo: Agence-France Presse

China’s embattled HNA cedes control of baggage handler Swissport to senior creditors in €1.9 billion debt-for-equity swap

Swissport airport workers walk across the tarmac at Liverpool John Lennon Airport in northern England, in May, 2016. Photo: Reuters

epa04866324 A Swissport baggage cart is seen on Zurich airport in Kloten, Switzerland, 30 July 2015. Swiss luggage handler Swissport is bought by Chinese HNA Group for 2.73 billion Swiss frances (2.81 billion US dollars). EPA/WALTER BIERI

HNA Group's buying spree. Swissport (cargo and aircraft ground handler) Reuters headquarters in London Tuniu Corp (Chinese online travel agent) Avolon Holdings (aircraft leaser) Ingram Micro (electronics distributor) Gategroup (airline caterer) Azul 23.7% (Brazil's third-biggest airline) CIT Group (aircraft leaser) US golf courses Hilton Group Kai Tak land ANZ Bank New Zealand's UDC Finance A stake in Deutsche Bank SCMP

Could Evergrande, which owed US$104.1 billion at the end of last year, collapse like HNA Group?

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Hui Ka Yan, the Chinese billionaire businessman and chairman of Evergrande. Photo: Imaginechina via AFP

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HNA Group’s founder Chen Feng and chief executive Adam Tan Xiangdong have been detained by police, the company said
The bankruptcy restructuring of HNA Group is proceeding in a stable and orderly manner, the company said



The detentions bring the curtains down on HNA, built on the foundations of China’s most successful private carrier Hainan Airlines.
