January 11, 2018 / 1:46 PM / 5 months ago

China's Hainan Airlines is "stable", says its share underwriter

BEIJING, Jan 11 (Reuters) - China’s Hainan Airlines Holding Co Ltd, part of the heavily indebted HNA Group, was described as “stable” on Thursday, by the underwriter of its recent large share placement.

The airline was used as the basis for the aggressive global expansion of HNA Group, which now faces financing strains after announcing $50 billion of acquisitions over the past two years.

The group’s debt-fuelled buying spree and opaque ownership structure have also sparked global regulatory scrutiny.

The airline’s shares are currently suspended from trading in Shanghai at its own request pending a major announcement.

Haitong Securities Co Ltd said on Thursday that the airline was “stable and well”, in a procedural review after underwriting a 16.55 billion yuan ($2.54 billion) private share placement by the carrier last September, China’s fourth-largest.

The Chinese securities firm said it had reviewed Hainan Airlines’s internal governance and business operations on Jan. 4-5 and Jan. 8-10.

The airline said on Wednesday about its own pending announcement, that it was “planning a major matter and it is not certain whether this matter constitutes a major asset restructuring,” without providing further details.

$1 = 6.5030 Chinese yuan renminbi Reporting by Ryan Woo; Editing by Elaine Hardcastle

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