It may have started life as an aviation group, but by the time creditors showed up with bankruptcy filings, China’s HNA Group was a massive conglomerate with broad interests; from property to logistics; from aviation to financial services, the company had a finger in every pie. 

In the 20-odd years since its inception, the group – built on the foundations of flagship unit Hainan Airlines – grew rapidly in China and beyond in a debt-fuelled spending spree. 


Source: HNA Group

Hainan Airlines is the flagship unit of China’s HNA Group

But on 29 January the juggernaut came to a grinding halt: the group disclosed that it received formal notice that so far unnamed creditors had filed for its bankruptcy and reorganisation at the Hainan High People’s Court ”on grounds that we cannot pay off due debts”, HNA Group stated.

It added that it will co-operate with the authorities and “promote debt disposition actively”, while ensuring that its various units continued to function as normal. 

A day later, Hainan province vice-governor Shen Danyang visited the group’s headquarters to discuss – among other matters – the firm’s financial situation. 

He stressed that the group’s predicament will affect “thousands of people”, but sought to downplay the notion that it was the end of the road: “Bankruptcy reorganisation is not… liquidation – the centre is not broken, but standing. It is reorganisation and rebirth,” Shen was quoted as saying. 

The Hainan provincial government, which in 2020 threw a lifeline by way of a joint working group to address HNA’s liquidity risks, also reiterated its support. 


Source: Wikimedia Commons

Carrier insists its operations are unaffected by parent company’s woes

Amid the spectre of bankruptcy and financial failings, the group has also quietly returned to its beginnings as an aviation conglomerate. Indeed, a check in recent months of the HNA Group website shows only mentions of its “core business of air transportation”, and curiously omits any mentions of its past forays into other sectors. 

The group calls itself both a “multinational enterprise group” and “local aviation company” that is keen on developing the local Hainan market.

But the group’s current predicament is a far cry from the bullish years of the mid-2010s, when it went on an aggressive acquisition spree both domestically and abroad. 


The HNA Group’s aviation portfolio is currently linked to a group of Chinese carriers – obscured by a notoriously opaque ownership structure. Apart from Hainan Airlines, HNA Group owns – both wholly and partially – other Chinese carriers like Beijing Capital Airlines, Air Changan, Suparna Airlines, as well as low-cost carrier West Air and high-end charter operator Deer Jet, which boasts a VIP-configured Boeing 787 – registration 2-DEER – in its fleet. 

But its portfolio grew in magnitude for over a decade, as it acquired aviation interests across the globe.

Some of HNA Group’s overseas airline investments
Airline NameCountryHNA Group involvementCurrent statusNotes
Hong Kong Airlines Hong Kong Bought up to 60% shareholding in the carrier in 2006 In operation Hainan Airlines Holdings now owns part of the airline
Hong Kong Express Airways Hong Kong Bought 45% stake in 2006 In operation Sold the carrier to Cathay Pacific; renamed HK Express
Africa World Airlines Ghana Incoporated in 2010; HNA’s initial shareholding unknown In operation HNA Group said to own 70%
Aigle Azur France Bought 48% equity stake in 2012 Ceased operations Filed for bankruptcy in 2019
Azul Brazil Bought 23.7% stake for $450 million in 2015 In operation Stake sold off in 2018
Comair South Africa Bought 6.2% stake in airline In operation Stake sold off in 2018
Virgin Australia Australia Took 13% stake in 2016 In operation Underwent voluntary administration in 2020; now operating under new owners

One of its first major aviation acquisitions happened in 2006, when it ventured into neighbouring Hong Kong to buy up shares in what was then known as CR Airways. HNA Group ended up taking around 60% of the carrier, and it was renamed Hong Kong Airlines. The strategy was to expand its presence in Hong Kong, connecting the city with points in China and beyond. 

The same year, HNA Group also acquired shares in Hong Kong Express, which was operating a small fleet of regional jets. The new ownership paved the way for it to be rebranded as a low-cost carrier – and sister unit to Hong Kong Airlines. 

In 2009, the carrier announced plans to start a new carrier in the northern Chinese port city of Tianjin. The move entailed changing HNA-owned regional unit Grand China Express into a full-service operator, with the Tianjin government co-investing in the new venture. 

Around the same time, a HNA Group-led consortium completed the purchase of Australia-based Allco Finance Group’s leasing unit, allowing it to expand into the leasing business. 

In 2010, HNA Group moved into the MRO sector, establishing a new company known as GCA Technik from the maintenance division of Hainan Airlines.

The group then ventured into Africa, in 2010 incorporating Ghanian carrier Africa World Airlines, which began operations in 2012 using a fleet of Embraer ERJ-145s. 

African World Airlines_ERJ145

Source: Wikimedia Commons

HNA Group owns shareholdings in Ghana’s Africa World Airlines

But things only really got going later that decade when HNA Group, by now flush with bank loans, took stakes in multiple companies outside of China. 

In 2012, the HNA Group made history by being the first Chinese aviation company to invest in an European airline, when it took a 48% stake in French regional carrier Aigle Azur, effectively becoming its second largest shareholder. 

The in 2015, HNA-owned leasing company Bohai Leasing bought rival Irish lessor Avolon, in a takeover worth $7.6 billion:  $2.6 billion for the company, plus Bohai assumed around $5 billion of Avolon’s debt.

The same year, HNA invested $450 million in Brazil’s Azul for a 23.7% stake, in a partnership that was reportedly to enable the latter to enter the Asian market. It also acquired a 6.2% stake in South African carrier Comair, its second investment in Africa. 

July of 2015 also saw the purchase of ground-handling firm Swissport for Swfr2.73 billion ($2.81 billion).

There was no let-up in subsequent years either: in 2016, it took a 13% stake in Virgin Australia for A$159 million ($121 million), plus an 80% share of Swiss-based maintenance firm SR Technics for an undisclosed fee. 

In 2017, it bought an 82.5% stake in Frankfurt-Hahn airport in Germany – HNA Group’s first investment in a non-Chinese airport. It also invested in Rio de Janeiro’s Galaeo International airport in Brazil. 

By then, HNA Group already had interests in areas outside of aviation, including in hospitality, where it took a stake in the Hilton group; as well as the technology sector, where it bought distributor Ingram Micro for $6 billion; plus interests in shipping container and truck trailer leasing, both acquired from General Electric. Its current non-aviation assets include several luxury properties and hotels in China, and part of an artificial island off Hainan. 


By 2017, it was reported that the HNA Group held CNY1 trillion in assets, with its expansion showing no signs of stopping. 

But stop it did – thanks in part to the Chinese government’s new measures, announced in 2017, to minimise private domestic companies’ exposure to foreign investments. 

HNA Group, along with three other conglomerates, was put under regulatory scrutiny, and several banks that dealt with the company’s foreign investments halted their loans to the group. 

The measures hit HNA hard – by 2018, it became apparent that the group was facing a liquidity crunch. Reports of unpaid aircraft leases emerged in late 2017, and a few months later, S&P Global Ratings downgraded the group’s creditworthiness. By then, it already chalked up $86 million in debt. 

It was reported that the group was looking to sell real estate and other assets in its portfolio to access additional cash and meet interest repayments. 

The same year, HNA Group sold its shares in Comair, and gave up its shareholding in Brazil’s Azul. It also disposed of assets in other non-aviation companies, including property in Hong Kong and Australia, the Ingram Micro and Hilton Group stakes, as well as its shareholding in Deutsche Bank and trailer rental business TIP Europe.

Adding to its financial woes was the death of co-founder and former chairman Wang Jian, who died in 2018 in an accident in France, while on a business trip. 

HNA Group’s issues have had a knock-on effect on its subsidiaries – Hainan Airlines itself struggled through most of 2018, battling heavy losses and numerous changes in its top management. The carrier was most recently listed as a potential target for consolidation in the Chinese airline market. 


Source: Chintung Lee/Shutterstock

Hong Kong Airlines has struggled in recent years

Hong Kong Airlines, meanwhile, came under scrutiny by the city’s civil aviation authorities over its own financial health, amid rumours of possible liquidation. HNA Group later sold HK Express to Cathay Pacific. 

Aigle Azur, in which HNA Group was the single largest shareholder, filed for bankruptcy in September 2019, and was liquidated weeks later after failing to secure a buyer. 

By February 2020, the embattled group threw in the towel, and sought the help of the Hainan provincial government to turn its misfortunes around. 

Divestments continued, however: Swissport passed into new ownership in December 2020 after restructuring, effectively wiping out HNA Group’s stake.

The coronavirus outbreak, which was first discovered in China, made the situation worst for HNA Group, eventually culminating in the bankruptcy application made at the end of January. 

While it is unclear how the HNA Group will emerge from the latest episode, it is unlikely to ever be the far-reaching giant it once was. 

Report amended to clarify timeline of HNA Group’s liquidity issues.