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HNA’s founder calls fugitive Guo Wengui’s patronage claims ‘a pack of lies’

HNA, one of China’s most aggressive global asset acquirers, is suing fugitive Guo Wengui for defamation for the allegations

PUBLISHED : Monday, 26 June, 2017, 12:01am
UPDATED : Monday, 26 June, 2017, 10:23am

Chen Feng, the founder of one of China’s most aggressive global asset acquirers, said his HNA Group is a bystander in a smear campaign by people under the pressure of the Chinese government’s crackdown on corruption and financial malfeasance.

If you choose to listen to a pack of lies by an internationally wanted fugitive, then there is a problem
Chen Feng, founder, HNA Group

The conglomerate on June 15 filed a defamation lawsuit in New York County’s court against Guo Wengui, a fugitive wanted by Interpol, over allegations in an interview and on Twitter that HNA had benefited from patronage by Chinese politicians.

“If you choose to listen to a pack of lies by an internationally wanted fugitive,” whose credibility had already been damaged by the prosecution of his cohorts, “then there is a problem,” Chen said in an interview with the South China Morning Post in his first media response to Guo’s claims. “If you look at the business of HNA and understand its true nature, then you’ll see these claims are nothing but lies.”

The company, based in the Hainan provincial capital of Haikou, has expanded from its 1993 establishment with four aircraft to almost 2,000 planes under operation and management. In the process, it also went on a global buying spree, owning 1 trillion yuan (US$146 billion) of assets, including stakes in Hilton Hotels & Resorts and Deutsche Bank.

In an April interview with the Voice of America’s mandarin service, Guo alleged that HNA owed its success to patronage by the Communist Party, with senior cadres and their relatives remaining as undisclosed shareholders. A claim was specifically directed at Wang Qishan, who heads the party’s anti-graft campaign, saying that his nephew Yao Qing was a shareholder.

“That’s 1,000 per cent untrue,” Chen said.

Watch: A photo slideshow of Chen Feng

Guan Jun, mentioned in a June 2 Financial Times article as among the company’s mysterious shareholders, “holds a tiny stake in the company” but is not a significant shareholder, Chen said.

Wang “was my superior when we worked together three decades ago” at China Agricultural Development Trust & Investment Corp, Chen said. “He attracted many young people to join him. I joined from the Civil Aviation Administration of China and worked under him, leading one of the teams. I learned a lot from him.”

The two parted ways when Wang was transferred to head China Construction Bank, while Chen left to establish Hainan Airlines in what was to become the seed of the HNA Group.

From banking, Wang went on to help former premier Zhu Rongji liquidate Guangdong International Trust & Investment Corp, the biggest bankruptcy of a Chinese state borrower.

He would go on to lead Beijing’s fight against the 2003 outbreak of severe acute respiratory syndrome (Sars) as mayor, earning himself the reputation as a problem-solver. He was promoted to vice-premier until President Xi Jinping picked him to head the Communist Party’s Central Commission for Discipline Inspection and manage the party’s dragnet on corruption.

That dragnet snared Guo, with several of his accomplices facing court charges on June 16 for their roles in aiding and abetting corruption. In addition to being wanted by Interpol, Guo himself is the defendant in at least three defamation suits by HNA, Soho China’s founder Pan Shiyi, and Caixin Media’s founder and editor-in-chief Hu Shuli.

Chen said he rarely meets Wang now since his former superior was promoted to senior political leadership.

Wang believes that “friendship between gentlemen” should be at arms length, Chen said. “I still send him a card every now and then during festive occasions, but we rarely meet,” said the 65-year-old, who displays a prominent photograph of him shaking hands with Xi in a study adjoining his sprawling penthouse office. “We are just not on the same level – he’s a senior government leader while I’m just a businessman.”

During the company’s 20th anniversary in 2013, Chen and his five co-founders pledged to pass all their HNA stakes to the Cihang Foundation, established under the Hainan provincial government. Chen and HNA co-founder Wang Jian are directors of the foundation.

“The idea is that we bring nothing with us when we die and we pass nothing to our families,” Chen said. “While we’re alive, we can enjoy the benefits of being part of the company, but all that goes when we expire.”

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