HNA Chief's Death Is Said to Delay Hong Kong Airlines Share Sale
(Bloomberg) -- Hong Kong Airlines Ltd.’s plans to sell almost a third of its stock has been held up after the sudden death of a top executive at HNA Group Co., one of the carrier’s biggest shareholders, according to a person familiar with the matter.
The death of HNA co-Chairman Wang Jian from an accident in France in early July has halted advanced discussions between the closely held airline and potential investors to sell as much as a 30 percent stake for $250 million to $300 million, the person said, asking not to be identified discussing a private matter. Wang was also involved in the negotiations because the sale would dilute the Chinese conglomerate’s stake in the airline, according to the person.
Proceeds from the sale could help the 12-year-old airline, which flies three dozen passenger planes to nearly 40 destinations across Asia Pacific and North America, expand to compete against giants such as Cathay Pacific Airways Ltd. HNA, which has unloaded more than $17 billion in assets this year to repay debt racked up in an international acquisition spree, sold a controlling stake of about 34 percent in the Hong Kong carrier to Frontier Investment Partner LP in July 2017.
Representatives at Hong Kong Airlines and HNA declined to comment. Contact information for Frontier Investment wasn’t immediately available.
It wasn’t immediately clear when talks would resume. At least five Asian investors, including the family offices of some Hong Kong tycoons, were among the suitors, the person said.
Despite its sale to Frontier last year, HNA’s Hainan Airlines Holding Co. still owns a 27 percent stake.
Hong Kong Airlines, which is seeking to win more crucial flight routes from the city’s aviation authority, is also planning an initial public offering in Hong Kong as soon as next year, the person said.
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