China’s debt-laden HNA Group faces billions of dollars in debt claims filed by 60,000 retail investors who poured money into wealth management products sold by its units as the once high-flying conglomerate struggles in a lengthy bankruptcy restructuring, reported Caixin.
The investors, mainly HNA employees and their relatives, filed debt claims exceeding RMB 30 billion ($4.6 billion), Caixin learned. They purchased the products mainly from three HNA-backed peer-to-peer lending sites, which raised funds for other HNA affiliates.
Once among China’s most aggressive overseas dealmakers, HNA borrowed heavily to buy global assets including stakes in Deutsche Bank AG and Hilton Worldwide Holdings Inc. until China tightened credit rules to crack down on capital flight and companies’ debt risks. After years of unsuccessful struggle to repay trillions of RMB in debts, HNA this year entered bankruptcy restructuring along with its 320 affiliates.