How HNA Group fell from grace Chinese conglomerate acted more like a hedge fund during acquisition spree
HNA Group CEO Adam Tan
In its rise to become one of China’s biggest firms, HNA Group acted more like a risky hedge fund or private equity group than a traditional conglomerate looking for long term investments, according to the Wall Street Journal. And that strategy has led to heightened scrutiny from regulators and Wall Street as the company’s expansion grinds to a halt.
HNA Group CEO Adam Tan has been flying around the world to convince leaders and companies to keep working with HNA, sources told the Journal, though the company denies that banks have stopped working with the firm.
Some credit-rating agencies have expressed concerns about HNA’s impact on companies it has acquired, and there’s a fear that pull-back from conglomerates like HNA could have a broader impact on markets.
“There is the risk of financial damage, but also public embarrassment if there is a big Chinese company that could go bankrupt,” Thilo Hanemann, a director at the New York consultancy Rhodium Group, told the Journal. There’s also the “contagion risk,” he added, of troubles at Chinese companies having global ripple effects.
There are no signs that HNA’s business is in immediate danger. Revenues during the first half of the year were 272 billion yuan, an increase of 92 per上海夜网论坛