Date
19 September 2017
HNA Group says Guo Wengui's comments caused the company to both forfeit business opportunities and suffer a share-price drop in one of its listed entities.Photo: AFP
HNA Group says Guo Wengui's comments caused the company to both forfeit business opportunities and suffer a share-price drop in one of its listed entities.Photo: AFP

China’s HNA Group sues exiled Chinese businessman

One of China’s most acquisitive companies is suing an exiled Chinese businessman for allegedly spreading what it says are falsehoods that have hurt the conglomerate’s reputation and financial interests, the Wall Street Journal reports.

HNA Group Co., the airlines-to-hotels conglomerate that has been facing mounting scrutiny, alleges that real-estate tycoon Guo Wengui made “repeatedly false and defamatory statements” linking a high-ranking Chinese official in the Communist Party and his nephew to the company, according to a complaint filed Wednesday in New York state court.

The lawsuit was filed in New York because Guo, who also goes by the name Miles Kwok, lives in an apartment in Manhattan and operates a business in New York County, according to the complaint.

In the complaint, lawyers for HNA allege Guo earlier this year falsely claimed that HNA’s shareholders include Yao Qing, a nephew of Wang Qishan, the party’s top anti-corruption official and a close ally of Chinese President Xi Jinping. Guo said Wang “truly held his nephew’s ownership interest”, according to the complaint. HNA in the complaint denied either man held stakes in the company.

HNA claims Guo’s comments caused the company to both forfeit business opportunities and suffer a share-price drop in one of its listed entities. It is seeking at least US$300 million in damages and a declaration from the court that Guo’s statements were false and defamatory.

“It will be a wonderful thing to have a legal battle with HNA Group here,” Guo said in a Twitter message to The Wall Street Journal. “I hope that the US legal system would give us a fair ruling regarding issues including [HNA’s] business in New York.”

The lawsuit comes at a sensitive time for HNA, which has attracted scrutiny recently over who truly controls the company. The conglomerate last month revealed more details about its ownership structure—including the revelation that a New York-based charity is now its biggest shareholder—but the disclosures have prompted more questions about the changes in ownership.

The company, which has US$146 billion in assets and which has taken large stakes in Deutsche Bank AG and Hilton Worldwide Holdings Inc., has been one of China’s most aggressive overseas investors. Chinese regulators in recent months have been looking at the company’s debt levels, alongside those of other large deal makers.

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