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HNA Group’s Debt Overhang Expanded in 2017

HNA Group has stepped up asset sales to reduce debt. Photo: VCG.
HNA Group has stepped up asset sales to reduce debt. Photo: VCG.

China’s aviation-to-finance conglomerate HNA Group reported a 22% increase in debt and a widening of the debt-to-assets ratio last year even as the company began selling assets to resolve a cash crunch brought on by years of heavy spending on offshore acquisitions.

A stock exchange filing (Link in Chinese) on HNA’s 2017 financials released late Friday shed light on the conglomerate’s persistent debt pressure. By the end of 2017, HNA had total assets of 1.23 trillion yuan ($194 billion), up 21.3% from the previous year. But debt grew even faster, by 22% to 737 billion yuan at the end of last year, the financial report showed. The debt-to-assets ratio climbed to almost 60% at year-end.

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