Another lengthy report from WSJ, last week about Hikvision, now about HNA.
Last year, HNA paid $6 billion all-cash for Ingram Micro.
Some key quotes from the WSJ report on HNA, who started as a regional China airline:
- "Between early 2015 and October, HNA had announced over 80 deals totaling more than $40 billion."
- "Now they have heavy debt and are sparking fears they could pose a systemic risk to China’s economy—as well as uncertainty over the future of cross-border investment."
- "Uncertainty surrounding HNA is compounded by the opacity of its ownership and corporate structure—a web of subsidiaries that makes it hard to figure out who controls what and who is ultimately liable if difficulties arise."
- "Earlier this month, a unit of the company had to pay 8.875% in interest to borrow $300 million for less than a year, compared with similar bonds issued by a junk-rated Chinese property developer at 5.5%."
HNA is, in American terms, if Southwest Airlines bought IT distributors, investment firms, hotel chains, etc. See HNA's list of acquisitions.
It will be interesting to see what impact this has on Ingram when HNA unwinds/collapses. On the other hand, Ingram has been bad enough already in physical security.