HNA Unit Bonds Fall to Record Amid Concern of Lender Support
Bonds of a unit of HNA Group Co. have fallen to record lows after fresh signs that the debt-laden Chinese conglomerate is facing increasing difficulties raising funds.
HNA Group International Co.’s $300 million 8.875 percent securities slid to about 93 cents on the dollar on Monday, the lowest level since they were sold last month, according to Bloomberg-compiled prices. The drop comes after Bloomberg News reported on Friday that people familiar with the matter said HSBC Holdings Plc told its dealmakers to avoid pursuing business for now with the conglomerate, and despite HNA Group saying that it won’t default on borrowings anytime soon.
Financial strains at HNA Group are growing after a debt- fueled $40 billion acquisition spree across the globe that invited scrutiny from regulators. HSBC joins other firms like Bank of America Corp., Citigroup Inc. and Morgan Stanley, which people familiar with the matter said in July were avoiding advisory and financing work for HNA.
“Bondholders are probably more worried about continued support from the banks,” said Charles Macgregor, head of emerging markets research at Lucror Analytics.
An HNA representative declined to comment.
December 11, 2017, 15:44:19 GMT
By Denise Wee; Edited by Andrew Monahan and Ken McCallum