Conglomerate HNA Group resolves debt after restructuring

Debt- ridden Chinese conglomerate HNA Group said on Sunday that it had succeeded in resolving its debt risks, more than two years after a working group was created to restructure the company’s debts.

In a post on its WeChat official account, HNA Group announced that a special service trust for its bankruptcy reorganization was established according to the law on Sunday.

The High People’s Court in South China’s Hainan Province approved HNA Group’s restructuring proposal on October 31, 2021. A consortium formed by CITIC Trust Co and Everbright Xinglong Trust Co was eventually chosen as the trustee, read the post.

The merger and reorganization plan involving 321 HNA Group- linked firms has been fully implemented, which has been confirmed by the court.

The announcement indicates the legal procedures involved with HNA Group’s bankruptcy restructuring have come to an end, Lin Zhijie, a market watcher, told the Global Times on Sunday.

HNA Group was once a huge and far- flung multinational spanning aviation transport, airport operations, hotel management and financial services, with over 2,000 domestic and overseas subsidiaries. The conglomerate was hit by a liquidity crisis in late 2017, due to inappropriate operations, mismanagement, runaway investment and a market downturn, which turned into a severe insolvency crisis, the Supreme People’s Court said in a statement in late January outlining 10 major commercial cases of 2021.

HNA Group was a calling card of China’s private economy, but it ultimately entered into bankruptcy reorganization due to multiple factors, Li Shuguang, a professor of the China University of Political Science and Law, was cited as saying in the statement.