China’s HNA boosts Dufry stake, pursues CWT purchase plan

HONG KONG: Chinese conglomerate HNA Group has completed the acquisition of a 16.2% stake in Swiss airport retailer Dufry AG from Singaporean sovereign funds GIC and Temasek, Dufry and HNA said.

No value for the deal was given, but the stake would be worth about US$1.4bil, given Dufry’s current market capitalisation of US$8.5bil. HNA’s total stake in the Swiss group will rise to 20.92%, the firms said.

HNA, one of China’s most acquisitive conglomerates with businesses spanning aviation to financial services, also said on Monday it is progressing its proposed US$1bil purchase of Singapore-listed logistics firm CWT Ltd.

The moves come as China’s state planner said last week it will strengthen rules to defuse risks for domestic companies investing abroad, and curb “irrational” overseas investment in its Belt and Road initiative.

M&A transactions by Chinese companies in countries that are part of the Belt and Road initiative are soaring, even as Beijing cracks down on China’s acquisitive conglomerates to restrict capital outflows.

Regulators in June ordered a group of lenders to assess exposure to some of the more aggressive dealmakers, including HNA.

At least two of HNA’s overseas deals have hit a hurdle as a result of the crackdown on transferring money outside China, sources said.

HNA said the Dufry shares purchase was in line with China’s Belt and Road policies, as Dufry’s businesses cover many countries and regions on the Belt and Road map.

Dufry runs more than 2,200 duty-free and duty-paid shops across five continents.