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HNA says could benefit from curbs on foreign deals

12/07/2016| 9:47:37 AM|

China's efforts to shore up its currency by placing restrictions on foreign acquisitions could benefit aviation giant HNA Group, said one of HNA's senior executives.

China's efforts to shore up its currency by placing restrictions on foreign acquisitions could benefit aviation and shipping giant HNA Group by reducing competition for deals from other Chinese bidders, a HNA top executive said.

Guang Yang, chief investment officer of HNA Capital - a unit of the fast-growing HNA Group that has been one of China's most acquisitive overseas dealmakers - also said on December 6 he hoped that the Chinese currency curbs would be temporary.

China has tightened control of capital leaving its borders in the past week to stabilize the yuan. Cash transfers abroad of more than USD 5 million for portfolio or direct investment are drawing more scrutiny from the government, reported Reuters.

"That will limit some other not so qualified - in our view - buyers," Guang told a breakfast policy meeting of the Cohen Group in Washington, D.C. "That will put us in a position to do acquisitions with less competition."

Guang added he was optimistic China's new capital controls are interim measures aimed at steadying its currency, given that they contradict the country's long-term plan of encouraging Chinese firms to invest abroad, as outlined under the "One Belt, One Road" blueprint.

Guang said HNA would also be interested in investing in U.S. infrastructure, which has been championed by U.S. President-elect Donald Trump, who wants to create jobs in the US.

Shares in HNA Holding Group, HNA Group's Hong Kong listed arm, plunged nearly 6.5% on December 4 after its controlling shareholder pledged 56.11% of its stake in the firm as security for a loan – a month after the group paid a jaw-dropping HKD 8.84 billion for the Kai Tak residential site acquisition in Hong Kong, reported SCMP.

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TAGS: HNA Group | Hainan Airlines
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