A HNA Group logo is seen on the building of HNA Plaza in Beijing, China February 9, 2018. — Reuters picSINGAPORE, April 17 — Singapore state investor Temasek Holdings has expressed interest in buying into Chinese conglomerate HNA's Hong Kong-based carriers, Hong Kong Airlines and Hong Kong Express Airways, according to a source familiar with the matter.
However, an investment in the unlisted Hong Kong carriers by Temasek remains subject to a due diligence process that has yet to begin, said the source on condition of anonymity.
The Singaporean investor would likely emerge as only a minority holder in the Hong Kong airlines, which control valuable slots at Hong Kong's capacity-constrained airport, if a deal is completed, the source said.
Temasek and the debt-laden HNA, an aviation-to-financial services conglomerate, last week signed a memorandum of understanding to explore business partnerships in aviation and logistics.
A second source familiar with the matter said HNA is looking to raise funds for the Hong Kong airlines and Temasek is a potential investor.
Buying into the Hong Kong airlines would help Temasek get an aviation foothold closer to mainland China, in a market dominated by Cathay Pacific Airways Ltd.
Temasek is the majority shareholder in Singapore Airlines Ltd, which sources said was not associated with the potential investment in the Hong Kong airlines.