Hainan Airlines’ parent company, the HNA Group, has requested the Hainan provincial government to set up a working group to look into its risk management efforts.
HNA states that it has faced increased liquidity risk of late, in light of the coronavirus outbreak, and was unable to manage the risks by itself.
The joint working group, which the provincial government will set up with other relevant parties, will “fully assist” in HNA’s risk management work.
Gu Gang, chairman of Hainan Development Holdings, the government’s investment arm, will lead the joint working group.
HNA’s appeal for government help comes amid news reports that the group might be taken over by the Chinese government. HNA has faced a liquidity crunch for the past few years.
Reports have also suggested that state-owned carriers Air China and China Eastern were preparing to discuss a takeover of HNA’s aviation assets.
Airlines in the HNA Group, such as Hainan Airlines, have been hard hit by weakened travel demand following the coronavirus outbreak. Hainan Airlines, for example, is reported to have put its foreign pilots on un-paid leave in an attempt to stave off losses.
The group has also tweaked its senior management structure, adding two more seats to its board of directors. Gu, who is leading the joint working group, will become its execuctive chairman. Current chairman Chen Feng will retain his role.