Hong Kong Airlines in Talks with Multiple Parties for Strategic Lifeline

By Alex Ho

Investing.com – Troubled Carrier Hong Kong Airlines is in talks with multiple parties, including Air China, for a strategic lifeline, South China Morning Post (SCMP) reported on Monday citing three sources familiar with the matter.

“Hong Kong Airlines is here to stay and committed to sustaining our long-term growth,” the airlinetold SCMP. “We are always open to strong strategic investors.”

The sources noted earlier takeover bid made by Citic Group, Wuxi Communications Industry Group have failed to progress because of a disagreement over pricing.

The airline was close to the brink for more than a year amid months of anti-government protests in Hong Kong and the coronavirus outbreak.

In February, Hong Kong Airlines said it was slashing 400 jobs and ask remaining staff to take at least two months of unpaid leave. Chairman Hou Wei said the changes were made to

ensure the airline’s very survival.

Indebted HNA Group currently owns 29% of the carrier, while former director Zhong Guosong has 27%.

HNA turned into a net seller of assets since a couple of years ago after China cracked down on its debt-fueled acquisitions.

The original disposal of Hong Kong Airlines is now awaiting the decision by HNA Group’s risk management committee on the overall strategy for the entire group, the sources said.

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