From a Buddha-shaped building on the tourist island of Hainan, HNA Group has transformed itself into one of China's most aggressive dealmakers — and drawn
To fuel its growth, it has
But the company's $40bn deal spree — most recently it became Deutsche Bank's largest shareholder by building up to a 9.9 per cent stake — has brought it criticism on several fronts. HNA recently became caught in the crossfire of a political storm involving Wang Qishan, China's anti-corruption tsar and one of its most powerful politicians. Its heavy use of debt has also drawn concern from Standard &
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HNA's corporate structure is complex.
Domestically, HNA owns a smorgasbord of property developers, leasing firms, four regional airlines, a respected financial magazine and one of China's largest peer-to-peer lending platforms, JuBao Internet Technology. It has raised funds through at least 11 peer-to-peer platforms, many of which it has invested in, as well as through loans to its roughly 25 listed companies.
Overseas, it has chosen some politically connected partners. The company invested together with Jeb Bush in a fuel shipping business when he was considering a presidential run, and it bought SkyBridge Capital from hedge fund manager Anthony Scaramucci when he was hoping to join the Trump Administration.
But HNA's "very complex and convoluted shareholding structure" has prevented either man's inclusion on the annual Hurun list of China's richest men and women, according to Hurun founder Rupert Hoogewerf. "We have been trying to get Chen Feng on there but we just can't find any way to show that he's got enough money."
HNA's largest single shareholder is also the most mysterious: Guan Jun, who purchased nearly 29
He first bought into HNA subsidiaries seven years ago, through an investment vehicle that operates out of HNA's Beijing offices. But HNA says
Chinese corporate registries list several other business addresses for
Reached by mobile phone,
He is also the man who introduced HNA to its most celebrated foreign investor, George Soros.
That airline is where HNA's story starts and one reason it has become caught up in factional politics today. For HNA's corporate heritage draws from reform experiments launched in the late 1980s, when Wang Qishan was a promising young technocrat rising in the shadow of his powerful father-in-law, Communist party elder Yao Yilin.
Now
But in the past month, an exiled businessman with ties to the state security apparatus has pushed forward allegations that
Guo Wengui, the former business partner of an imprisoned security official, has claimed on widely viewed Twitter posts over the past month that Yao Qing, a nephew of
"The allegations with regard to HNA simply aren't true. Neither Wang Qishan nor his nephew by marriage,
What is clear is that
Back in the 1980s, China received soft loans from the World Bank to help fund the country's economic reforms as it recovered from 30 devastating years of Communist orthodoxy. At that time
Then came the June 1989 crackdown on pro-democracy protests
But a core group of
Xingnan Group provided the start-up capital for Hainan Airlines and recruited many of the men who are now its top executives, including current chairman Wang Jian, according to the memoir. Other senior HNA executives include former Hainan government officials and the former head of state-owned rubber farms that were among the earliest World Bank loan recipients.
Reporting by Lucy Hornby, Sherry Ju, Liu