HNA Group has agreed to sell all outstanding shares of its airline catering services division gategroup to Asian investment firm RRJ Capital.
This move follows HNA Group’s intention to raise funds through a public listing for the airline caterer in an effort to help tackle HNA’s liquidity crunch on 5 March, reported Reuters.
Based in Zurich, Switzerland, gategroup offers airline catering services to more than 700 million passengers every year from over 200 operating units in at least 60 countries/territories.
The transaction is expected to be complete in April this year, following which, RRJ Capital will become gategroup’s sole shareholder.
Gategroup CEO Xavier Rossinyol said: “We are absolutely delighted to work with RRJ Capital and Temasek going forward as they contribute their expertise, network and growth track record to gategroup.
“Gategroup has made significant progress thanks to the excellent support of the HNA Group leadership team and the guidance of chairman Adam Tan.
“We are grateful for their support in progressing our Gateway 2020 strategy which we defined in 2015 and has allowed us to achieve exceptional performance for the fourth consecutive year, including an all-time high in revenue and EBITDA in 2018.”
Singapore-based investment firm Temasek will remain an investor in gategroup through a mandatory exchangeable bond.
Temasek and RRJ Capital joined HNA Group as investors in gategroup by subscribing a five-year mandatory exchangeable bond in July last year.
The bond will offer up to 49% of the share capital of the airline caterer.
RRJ Capital founder and chairman Richard Ong has also joined as a member of gategroup’s board of directors.
Ong said: “Today marks another milestone for RRJ Capital and Temasek and is a natural next step following from our initial investment in the company in 2018.
“Over the past three years gategroup has, thanks to its strong management team, made swift progress on the implementation of their successful Gateway 2020 Strategy. We look forward to supporting their growth aspirations.”