When President Ronald Reagan was shot on March 30, 1981, Secretary of State Alexander Haig famous declared at a press conference “I’m in control here.” As a factual matter describing what was going on at the White House that may have been true, but it appeared as though he was usurping the constitutional role of Vice President George H.W. Bush.
As best as anyone can tell Alexander Haig, who passed away in 2010, may well be in charge today at Hong Kong Airlines. That’s as good a theory as any other as two different people claim to be running the airline after a boardroom coup. Hong Kong’s government is trying to figure out who is running the airline, too.
Hong Kong Airlines is financially troubled. HNA Group, being crushed by a mountain of $100 billion in debt, has been under orders to sell off assets. It’s struggled to make debt service payments. HNA Group had been the largest shareholder of Hong Kong Airlines, though it has since reduced its stake to 29% while Chinese private equity firm FIP holds 34%.
The carrier has been ordered to come up with a plan for capitalization, but investors have been loath to put money in as they sort through where the airline’s money has gone — believing that it has been looted by HNA.
Now it’s not even clear who is officially in charge,
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.
Zhong Guosong proclaimed himself chairman of Hong Kong’s third largest carrier just a day before supposed chief Hou Wei assured staff in a memo that he was still at the helm of the financially fragile company.
…It was not clear who was officially in charge but neither side appeared to be backing down, as the carrier fights for its future amid financial instability.
Zhong Guosong is the third largest owner of the airline with a 27% stake, and says they’re looking into “embezzlement of assets and serious financial misappropriation by HNA.”
There aren’t just dueling chief executives but also dueling spokespeople. And there are reports that Zhong’s stake in the carrier may have been sold to another entity. Over a dozen of his representatives entered company headquarters yesterday “to enforce the message about the leadership change.”
In all the confusion perhaps they’ll come out with another mistake fare.