HNA Group cancelled the planned IPO for its Swiss catering unit Gategroup on March 26, just a day before trading was due to start, dealing a blow to the Chinese conglomerate's restructuring plan, the Financial Times has reported.
The debt-ridden conglomerate planned to raise as much as CHF1.3 billion francs (USD1.38 billion) from floating up to 65% of Gategroup's shares. Another CHF350 million was expected to be raised through the sales of new shares. Reportedly, the IPO was cancelled due to lower than expected interest from investors.
According to FT's sources, investors could have been wary to get involved in an HNA unit given the uncertainty surrounding the group's financial situation. On top of that, the price was reportedly set too high.
HNA has an estimated USD20 billion in debt maturing by the end of 2019 and has recently admitted to liquidity issues caused by the conglomerate's global acquisition spree. In the last three years alone, the conglomerate has been reported to have spent some USD50 billion for acquisitions.
The Chinese group also plans to list its ground handling unit Swissport. The IPO is planned for the second quarter of the year. HNA Group is also selling some USD6 billion worth of real estate in Australia, Hongkong, and New York, Reuters has reported. The conglomerate has also been reported to be reducing its stakes in other listed companies, such as Deutsche Bank. In February, HNA Group announced it expects to sell as much as CNY100 billion yuan (USD15.8 billion) worth of assets in the first half of 2018 alone.
