BEIJING—The chairman of cash-strapped HNA Group has been barred from taking flights and high-speed trains or going on vacations because of the Chinese conglomerate’s failure to pay a court-ordered $5,300 in a lawsuit, a court document showed.
The once high-flying company, which owns Hainan Airlines, is in the midst of a restructuring led by the Hainan Province government to resolve liquidity concerns that stem from years of aggressive acquisitions abroad.
The group and its affiliates have delayed payments on a few bond products this year.
HNA Chairman and legal representative Chen Feng also has been barred from spending at star-rated hotels, nightclubs, and golf clubs, and buying properties and high-premium insurance products, an order from the People’s Court in Xi'an city’s Beilin district showed on Sept. 15. The order also disallows his children from attending private schools.
The conglomerate declined to comment on the order.
The Xi'an court had ruled in March that HNA Group, along with its three affiliated companies, needed to return money they owe to a plaintiff named Chai Jin in a dispute involving HNA’s high-interest online investment platform Jubaohui.
The companies were told to pay Chai more than 36,000 yuan ($5,320) of principal and interest within 10 days of the March ruling, according to the court. But they failed to do so, the court order on Sept. 15 said.
It wasn’t immediately clear if HNA subsequently paid Chai.
HNA hasn’t been able to fully pay back its Jubaohui investors since early 2018, as its liquidity worsened even as it began a frenetic sales of assets. There were still some 37.1 million yuan in overdue and unpaid debts at the end of August, according to data released on Jubaohui’s official website.
To make matters worse, the coronavirus pandemic, which had devastated travel demand and hurt HNA’s main aviation business, led many to believe that HNA’s survival was at stake.
