HNA GETS AUSTRIA GREEN LIGHT

Regulator says ‘no objections’ to firm’s bid for major stake in investment manager

HNA Group’s plan to take a majority stake in Vienna-based C-Quadrat Investment AG has gained approval from Austrian regulators, a rare recent win for the acquisitive Chinese conglomerate amid rising global pushback on its deals.

HNA, which has announced acquisitions worth more than US$50 billion (RM203.9 billion) in the past two years, has faced growing questions about its governance and ownership structure. Just this week, New Zealand blocked HNA’s US$460 million purchase of a finance unit.

C-Quadrat, worth some €226.9 million (RM1.1 billion) by market value, is the company through which HNA holds its near 10 per cent stake in Germany’s Deutsche Bank AG.

The investment manager said in a filing on Thursday it had been informed that Austria’s Financial Market Authority had “no objections” to the deal.

The deal, which still needs approval from the Central Bank of Armenia, would see HNA own 74.8 per cent of a third company Cubic, which in turn would hold 98 per cent of C-Quadrat, said the Austrian firm.

Meanwhile, HNA has used part of its stake in Postal Savings Bank of China Co to borrow money, as it seeks to boost liquidity amid c onc erns its debts a re weighing on its finances.

HNA pledged 919.3 million shares, or a 4.13 per cent stake, at HK$3.08 (RM1.61) apiece on December 15, said the group in a filing on Thursday, without saying how much it borrowed.

HNA lent the shares to institutional investors as part of a financing arrangement that didn’t reduce its holding in the bank, said a representative of the company. Postal Bank shares closed at HK$4.04 on Thursday.

HNA, which announced more than US$40 billion of acquisitions since the start of last year, is now saddled with US$28 billion in short-term debt.

Interest expenses have surged above levels it can cover through earnings, and it may have paid more interest than any other non-financial company outside of the United States and Brazil.

Officials at HNA have said the group has a “healthy and stable debt structure” and ruled out any default in the coming year.

In a separate filing, China International Fund disclosed an increase in its Postal Savings Bank stake by 919.3 million shares, citing interests through a securities borrowing and lending agreement.

HNA invested more than HK$7 billion in Postal Savings Bank shares at their IPO price of HK$4.76 apiece last year. Agencies