Hong Kong Airlines is currently in a chaotic game of thrones inspired CEO battle, as two rivals in the company both claim to be the current leader of the airline.
With both sending messages declaring their own right to rule, the airline has been left rudderless as it approaches financial ruin.
The current situation for Hong Kong Airlines
Hong Kong Airlines is currently in financial strife due to market conditions.
The airline has been experiencing financial problems and is currently trying to restructure. Reportedly, it is considering reducing the size of its fleet from 38 to 28 aircraft by cutting 10 Airbus A330-200s. It has also not been able to take ownership of four aircraft from suppliers due to lack of funds. It is also believed that Cathay Pacific is considering the acquisition of a minority stake in Hong Kong Airlines.
In late 2018, both co-Chairmen, Mung and Zhang Kui, resigned, allowing the chief marketing officer of Hainan Airlines, Hou Wei, to become the new director in November 2018.
Hong Kong Airlines is currently owned by these entities:
- HNA Group, a consortium, owns 29%
- FIP, a Chinese private equity firm, owns 34%
- Mr Zhong Guosong, former director of the airline, who owns 27% of the airline.
Remember their names, because it is about to get messy.
Who is the director of Hong Kong Airlines?
Just yesterday Zhong Guosong said in a company wide statement that he was the CEO again. This was a bit of a surpise to currently sitting CEO Hou Wei, who Zhong has said allowed HNA to loot the company dry from financial support.
HNA is currently facing $100 Billion in debt and has been court ordered to start selling off assets (like Hong Kong Airlines) in order to make ends meet.
“Hong Kong Airlines was in turmoil on Wednesday after an apparent boardroom coup in which a former director claimed he had taken control due to financial irregularities on the part of shareholder HNA Group.” – South China Morning Post
A PR firm that is connected to Zhong released a statement addressing these actions. “These steps were taken to secure the financial future of Hong Kong Airlines and stop further related party transactions,” said Zhong ““embezzlement of assets and serious financial misappropriation by HNA.”
In rebuttal, all Hou has said that the airline is currently undergoing a ‘shareholder dispute’. ““I will continue to work hand in hand with our leadership team to take concrete action to secure Hong Kong Airlines’ future. We will also keep you updated on the company’s current situation accordingly” Hou said in a statement.
Apparently, at an extraordinary board meeting on Tuesday, Zhong challenged the current CEO and got elected through the backing of two major shareholders.
But it gets even murkier when it was rumored that Zhong actually sold his shares to others just yesterday and isn’t actually eligible to sit as CEO.
This has even left the Hong Kong government baffled, as they ask the airline to clarify who exactly is in charge. Both the Transport and Housing Bureau and the countries airline licensing body have only been told that ‘boardroom changes are underway’.
Stay tuned for next week’s episode of “Who’s airline is it anyway”.
Let us know in the comments who you think should be in charge.