In the last two years, Chinese conglomerate HNA has been on a wild shopping spree, agreeing over 80 deals worth more more than $40 billion including stakes in Deutsche Bank and Hilton Worldwide Holdings. But the heavily-indebted group is now changing course, with CEO Adam Tan on Tuesday announcing the sale of some investments and declaring that it will refrain in future from investing in areas not backed by the government, Chinese media reported.
“If the state doesn’t support a sector, we won’t invest in it,” Mr. Tan told a conference hosted by the Chinese business magazine Caijing, according to domestic media. The company has already sold some investments to improve liquidity, he said, and is contemplating the sale of other assets that aren’t active in state-supported industries. “Companies cannot invest chaotically overseas, because chaotic investment creates trouble,” the executive said, according to media portal sina.com.
The change of course follows mounting political pressure on the group. At the conference, Mr. Tan kept stressing how important the stance of the ruling Communist Party was for HNA’s future corporate strategy. But he’s not alone in drawing the party’s ire. It also recently singled out real-estate company Wanda, conglomerate Fosun and insurer Anbang for their foreign investments.