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HNA Aviation buys 48 per cent of Tianjin Airlines
Posted on Friday, 18 October 2019 12:26
Hainan Airlines is selling a 48.0 per cent stake in Tianjin Airlines to HNA Aviation for CNY 6.69 billion (USD 944.22 million) as Chinese conglomerate HNA Group continues to restructure following a debt-fuelled acquisition spree.

The transfer constitutes a connected transaction as the troubled real estate-to-financial enterprise controls the acquiror and is a major shareholder of the vendor.

Predecessor Grand China Air was established in 2004 to bring the major aviation assets of Hainan Airlines, China Xinhua Airlines, Chang An Airlines and Shanxi Airlines under one umbrella.

The group changed its name in 2009 and, according to its website, operates 104 aircraft across 290 domestic and international routes spanning Japan, South Korea, Russia, Australia, New Zealand and the UK.

In 2018, it had annual passenger volume of more than 14.00 million and, in March 2019, was ranked 12th by the Centre for Aviation in terms of international seat capacity in 2018.

According to the industry intelligence provider, Chinese airlines grew international passenger traffic by 14.0 per cent last year alone.

There are now 29 Chinese competitors operating international services, compared with 12 carriers five years ago, including Air China, China Eastern and China Southern.

In the first six months of 2019, Tianjin Airlines had an operating income of CNY 6.64 billion and net profit of CNY 180.00 million.

Zephyr, the M&A database published by Bureau van Dijk, shows 306 deals targeting the global air transportation sector have been announced so far this year.

The largest by value features the state-owned enterprise that holds listed China Southern Airlines opening up its equity base to outside investors by accepting a USD 4.36 billion investment from provincial and local government entities.

Zephyr shows the Tianjin Airlines stake sale will be the sector’s fifth-largest of 2019 to date.

© Zephus Ltd