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HNA Group Subsidiaries Witness Rise in Stock Prices After Seeking Government Aid

Shares in HNA Group-controlled firms climbed Monday after the Chinese aviation and tourism conglomerate stated it had asked the government to help it address liquidity risk brought on by the coronavirus epidemic, which has exerted pressure on the airline sector.

HNA Group Subsidiaries Witness Rise in Stock Prices After Seeking Government Aid

HNA immediately owns or holds stakes in numerous local Chinese carriers, which have suffered in recent weeks from widespread flight cancellations and contracting demand.

Hainan Airlines Holding, the flagship of HNA Group, climbed by over 3%, while HNA Technology Investments Holdings soared 40%.

Other models equivalent to HNA Investment Group and HNA Technology saw their prices spike.

HNA Group stated Saturday it had asked the Hainan provincial authorities to steer a working group as it was not able to take care of the liquidity risk itself.

The group had acknowledged liquidity concerns before the coronavirus pandemic began. In December, Chair Chen Feng stated HNA had faced a cash circulation shortage that compelled it to delay salary funds.

Its Saturday declaration has pushed substantial discussion in China on whether there can be a carving up of its property.

Two weeks earlier, HNA-associated stocks also surged on a media report that read China’s government planned to take over the debt-laden conglomerate.

HNA Group was one of China’s most competitive deal-makers, spending $50 billion in international acquisition series that includes giants such as Deutsche Bank and Hilton Worldwide Holdings.

It started selling many of its purchases two years earlier to focus on its airlines and tourism businesses after its massive spending drew a probe from China’s central authorities and other overseas regulators.

Analysts stated concerns that have affected Hainan Airlines and other HNA arms mainly persist and questioned the extent to which local authorities’ involvement will help them toward steady profits.