August 2, 2018 / 11:17 AM / 10 months ago

HNA Group to sell minority stake in Avolon: sources

Illustration photo of the HNA logo December 21, 2017. REUTERS/Thomas White/Illustration

(Reuters) - China’s HNA Group Co Ltd HNAIRC.UL has been looking to sell a minority stake in its aircraft leasing business Avolon Holdings Ltd and has reached out to some parties in the last couple of months, according to some industry sources.

HNA, however, is keen that it gets full price for the stake sale, the sources said.

Avolon is owned by Bohai Capital, which in turn is majority controlled by HNA Group.

HNA and Avolon did not immediately respond to requests for comment.

The recent sale of two relatively small lessors - NWS Holdings Ltd (0659.HK) bought Sky Aviation and Jet financier Amedeo tied up with Intrepid Aviation - shows that there is strong appetite for aviation assets, one source said.

Long-term money, such as Canadian pension funds, are interested to invest in the sector, said the source.

The source did not know if there was a formal process for Avolon, but said HNA has been sounding out potential buyers.

Potential suitors that have held talks include companies controlled by the families of Hong Kong billionaires Li Ka-shing and Henry Cheng, said Bloomberg, which first reported the news, citing people with knowledge of the matter.

The Chinese aviation-to-financial services firm has been unloading assets and its stakes in companies such as Hilton Worldwide Holdings Inc (HLT.N), Park Hotels & Resorts (PK.N) and Spain’s NH Hotels (NHH.MC) as part of a wider reorganization.

Additional reporting by Sanjana Shivdas in Bengaluru; Editing by Bernard Orr and Neil Fullick.

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