The Hainan High People's Court initiated bankruptcy reorganisation proceedings against HNA Group acting upon a petition filed by an unnamed creditor.

"On January 29, 2021, HNA Group received a formal notice from the Hainan High People’s Court," the holding said in a statement. "The main content of the notice is: a creditor has filed an application for the initiation of reorganization procedure against our company, on grounds that we cannot pay off due debts to the creditor."

The holding underlined that its operations, including those of its carriers such as Hong Kong Airlines (HX, Hong Kong Int'l) and Hainan Airlines (HU, Haikou) among others, will continue.

"HNA Group will comply with the court’s instructions of judicial review in accordance with the law, promote the disposition of the debt actively, support the court to protect the legal rights and interests of creditors in accordance with the law, and safeguard our normal business to be operated successfully," it added.

The holding owns an estimated 2,300 companies in total. In June 2019, its total liabilities were estimated at CNY706.7 billion yuan (USD110 billion).

Shortly before HNA Group's announcement, Bloomberg reported that the Chinese government was planning to downsize the holding through the sale of all non-aviation assets via a trust. The group's airline businesses would then continue to operate albeit as state-owned entities. HNA Group's numerous creditors would then be offered either a stake in the trimmed-down, aviation-only holding, or participation in the proceeds from the trust-run sell-off. The plan has yet to be formalised.

Since February 2020, HNA Group has been controlled by the provincial government in Hainan.