China Merchants Bank provides a RMB 1 billion loan to HNA Group to finance its finance its acquisition of Gategroup Holding AG

Project narrative

Circa February 10, 2017, China Merchants Bank entered into a RMB 1 billion ($146 million USD) bridge loan agreement with HNA Group Co., Limited — a Chinese conglomerate headquartered in Haikou, Hainan — to finance its finance its acquisition of Swiss airline catering company Gategroup Holding AG. The loan carried a maturity period of one year. Gategroup Holding AG was a Switzerland-incorporated independent global company providing services to the travel industry, including catering, onboard retail, food service provisioning, and food logistics. It supplies catering to many major airlines. Its head office is in Glattbrugg, Switzerland and was listed on the SIX Swiss Exchange. On April 11, 2016, HNA Group entered into a definitive agreement with Gategroup Holding AG for HNA Aviation (Hong Kong) Air Catering Holding Co., Ltd., a subsidiary of HNA Group, to launch an all-cash public tender offer for all publicly held registered shares of Gategroup for an all-cash consideration of $1.46 billion USD (CHF 1.4 billion). The tender offer was published in May, offering CHF 53 per share. The tender offer was completed on July 7, 2016. HNA planned to delist Gategroup from the SIX Swiss Exchange and operate the company as an autonomous portfolio company, believing Gategroup would improve its international expansion pace and strengthens its capacities in the field of air catering. The acquisition was expected to improve Gategroup's business in Asia Pacific. The acquisition was expected to be completed before January 2017. The separating trading line for shares tendered into the offer closed on December 20, 2016. The acquisition was completed on December 22, 2016, with delisting on the SIX Swiss Exchange to follow. HNA Group experienced general financial difficulties, including related to the acquisition. In December 2017, it was reported by Reuters' IFR reported that HNA was seeking to extend debt used to acquire Gategroup. On February 14, 2018, it was reported that the lenders had deferred payments on a $700 million USD ($5.46 billion HKD) bridge loan HNA used to acquire Gategroup that was due on February 28, 2018 by a year. It is unclear whether the China Merchants Bank bridge loan experienced such issues. On March 29, 2019, it was announced that HNA Group entered into an agreement to sell all outstanding shares in Gategroup Holding AG to RRJ Capital. The sale was completed on April 3, 2019.