HNA Group chairman Chen Feng has expressed confidence that China's aviation-to-financial services conglomerate will manage its cash crunch, and continue to receive support from banks and other financial institutions this year.
The liquidity problem exists “because we made a big number of mergers”, even as the external environment became more challenging and China’s economy “transitioned from rapid to moderate growth”, impacting the group’s access to new financing, Mr Chen told Reuters in a rare meeting.
It was a rare acknowledgment by a top company official that HNA is facing financing problems. In recent weeks, local banks have privately and publicly voiced concern after HNA failed to repay some obligations, including aircraft lease payments, and as surging debt drove up the cost of the group’s short-term fund raising to new highs.
Significant moves are expected. HNA's flagship Hainan Airlines Holding Co, Bohai Capital Holding Co, the parent of aircraft leasing firm Avolon, and Tianjin Tianhai Investment, which controls California-based Ingram Micro Electronics, each have suspended trading pending major announcements.
– Reuters
