Caixin
Feb 09, 2017 02:02 PM
BUSINESS & TECH

HNA Merges Logistics, Technology Units

(Beijing) — HNA Group Co. Ltd., one of China’s most active global private equity investors, has consolidated its logistics and technology divisions into a single unit as part of a reorganization to sharpen its investment focus, a knowledgeable source told Caixin.

The newly merged unit will own Ingram Micro, which was one of HNA’s largest purchases last year when it bought the U.S.-based electronic components distributor for $6 billion. The new science and logistics unit is one of the largest for HNA, which is based in the tourist haven of south China’s Hainan Island.

The new unit could also become the owner of Singapore logistics firm CWT Ltd., which with HNA was reportedly in talks to buy for about $1 billion last year. That purchase was delayed over changes to the deal structure and internal discussion about which of HNA’s units would make the actual offer, according to media reports last fall.

Headed by deal maker and aviation tycoon Chen Feng, HNA has yet to formally announce the merger of its technology and logistics units. But the two appear together under a single name in a corporate overview on the group’s website, which says the combined unit has more than 180 billion yuan ($26.2 billion) in assets and 300 billion yuan in income.

The merger is part of a broader overhaul that saw HNA recently merge its airline and tourism units, two of its oldest divisions. That pair have been among the company’s most active in terms of global acquisitions, including last year’s purchase of 25% of U.S. hotel giant Hilton Worldwide Holdings Inc. for $6.5 billion.

The airline and tourism unit also agreed to buy CIT Group Inc.’s plane-leasing business last year, and it owns one of HNA’s oldest assets, Hainan Airlines Co. Ltd., China’s fourth-largest carrier. The broader HNA Group currently has more than 1 trillion yuan in assets, with an annual income of more than 600 billion yuan. Its other major units include its capital and industry arms.

HNA is one of an aggressive group of Chinese globally minded private equity buyers to emerge over the last five years. Other big names include the Shanghai-based Fosun Group, which helped to finance a management-led purchase of French resort operator Club Med in 2015; and Beijing-based insurer Anbang Insurance Group Co. Ltd., which bought the hotel Waldorf Astoria New York the same year for nearly $2 billion.

Contact reporter Yang Ge (geyang@caixin.com)

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