* Value Partners says ends talks with "potential offeror"
* HNA has been looking to bolster its financial investments
* Shares in Value Partners fall 4 percent in Hong Kong
* HNA has faced rising borrowing costs in recent months (Adds context on HNA's financial business, updates share price, deal details)
HONG KONG/BEIJING, Jan 5 (Reuters) - Talks have been called off between HNA Group and Value Partners Group over the Chinese conglomerate's purchase of a stake in the Hong Kong-listed asset manager, people familiar with the situation said.
The dropped deal comes as HNA faces financing strains following $50 billion of acquisitions over the past two years which have sparked scrutiny of its opaque ownership and use of leverage.
Talks between HNA and Value Partners' two founders, Cheah Cheng Hye and V-Nee Yeh, began last May, according to a stock exchange filing by the Hong Kong company. The fund manager did not disclose the size of the stake proposed to be sold.
Neither that filing, nor one announcing the talks' end on Thursday, named HNA but people familiar with the matter confirmed the talks were with the Chinese conglomerate.
Cheah and Yeh own 19.2 percent between them. Cheah Company Ltd, a family trust, owns an additional 21.80 percent stake in Value Partners. The combined 41 percent stake was worth $820 million at market close on Thursday.
A stake in Value Partners, among Asias largest independent asset managers, was one of series of equity deals in financial groups being pursued by HNA as it looks to expand beyond its base in airlines, tourism and logistics.
The ending of talks was "solely a result of the parties' commercial consideration in respect of the possible transaction," Value Partners said in its exchange filing on Thursday. It did not elaborate.
Shares in Value Partners were down 3.9 percent at 0604 GMT, while the Hang Seng index was 0.1 percent lower.
Prices of HNA's bonds were unchanged, while bond traders said HNA's need to roll over its existing financing would have made any deal difficult to finance.
"Our base case assumption was this deal would not go through," said a bond trader at a U.S. bank. "Any fresh financing is not a wise move for them as they have to go to the same banks they need to go to for rolling over."
Value Partners and HNA declined to comment.
HNA last year started a push into financial services, buying large minority stakes in the U.S. operations of Old Mutual Asset Management and also in Deutsche Bank.
It also bought New Zealand's largest non-banking lender, UDC Finance, and a controlling interest in hedge fund platform SkyBridge Capital in the United States.
New Zealand's regulator blocked the UDC deal last month and the SkyBridge deal has not yet closed.
In November the conglomerate also suffered a downgrade in its creditworthiness, as measured by S&P Global Ratings, as a result of its "aggressive financial policy."
An HNA executive told Reuters in December that the conglomerate was not facing a liquidity crisis and characterized its high-profile investments - such as Deutsche Bank and hotels group Hilton - as successful.
Financial services accounted for about 17 percent of the groups operating revenue of 183 billion yuan ($28.22 billion), and more than 40 percent of gross profit in 2016, led by its financial leasing operations, an HNA Group bond filing shows.
($1 = 6.4841 Chinese yuan renminbi) (Additional reporting by Jennifer Hughes and Umesh Desai in Hong Kong; Writing by Sumeet Chatterjee; Editing by Stephen Coates)