After efforts by Hainan Province to establish a regional airline (Hainan Provincial Airlines) were not successful, Chen was tasked with bringing in private expertise and investment.[5] Chen was able to raise 250 million yuan (US$31.25 million) in new capital, 75% from 24 institutional investors, 20% from existing corporate staff, and 5% from the Hainan government.[5] In 1993, Chen launched the Hainan Airlines Company Limited[5] China's first joint-stock air-transport enterprise. Due to the 1997 Asian financial crisis - which caused the collapse of several local financial and real estate companies - the airline was recapitalized by the Hainan government and restructured and its name changed to Hainan Airlines (HNA) Company, Ltd.[5] Hainan province was particularly affected by the crisis due to it being both a tourist and retirement destination that had seen a high amount of speculative development and lending. In 1995, George Soros invested $25 million in the airline for a 14.8% stake, becoming its largest shareholder.[1][6]
In 2000, the Chinese national government forced the creation of three major domestic aviation companies: Air China Ltd., China Eastern Airlines Corp, and China Southern Airlines, which accelerated Chen's plans for expansion.[5] In 2000, Chen co-founded a holding company, the HNA Group, together with partner Wang Jian,[3] and used it as a vehicle to purchase Xi'an-based Chang'an Airlines in August 2000 and China Xinhua Airlines and Shanxi Airlines, both in 2001.[5] In August 2001, Hainan Airlines merged with Haikou-based Meilan International Airport in Hainan province.[5] Despite the mergers and acquisitions, Hainan Airlines remains the 4th player in China[5] with 15% market share in 2012.[2] In June 2006, Chen created another holding company, Grand China Airlines Holdings, to hold the airline assets of the HNA Group - then consisting of 100 planes and 30 billion yuan (US$3.75 billion) in assets,[5] freeing the HNA Group to expand into other business lines. At the time, Chen owned 32.75% of Grand China Airline Holdings shares.[5] In 2012, the HNA Group had sales of US$17.5 billion and pre-tax profits of US$837 million. The group structure of the HNA Group is known to be extremely complicated.[2]
Chen was able to go on an acquisition spree - using his holding company, the HNA Group, as the primary purchasing vehicle - and expanded its operations into logistics, retail, property, tourism, and financial services. Commenting on future growth, Chen stated in 2014: "By 2020, we can become one of the top 100 companies, and by 2030, we want to be one of the top 50...Assets are still cheap in the U.S. and Europe, and we will continue to acquire them. We need a batch of world-class companies to emerge from China to help the country's growth, and HNA will be one of those. We want to be everywhere."[7]
At one time, the group had the largest stake in Deutsche Bank.[8]
According to the HNA Group website, in 2015, the HNA Group included controlling stakes in 11 listed companies, revenues of RMB 190 billion ($25.6 billion USD), group assets of RMB 600 billion, and over 180,000 employees worldwide.[9]
In May 2017, HNA Group's stocks fell by 16.7%, its biggest intraday drop since November 18, 2015, following allegations by Guo Wengui of infighting and wrongdoing of Chinese leaders, although the direct causation could not be established.[10]
According to WSJ on September 24, 2021, embattled Chinese conglomerate HNA Group said on Friday that its chairman Chen Feng and Chief Executive Adam Tan are suspected of committing crimes and have been detained.
HNA said on its official social media account that the pair were "placed under compulsory measures," citing a notice from the Hainan police. It added that the company's operations remain orderly.
As of September 24, 2021, HNA Group was broken into 4 components due to a bankruptcy court order.[8] Liaoning Fangda Group Industrial Company Ltd, a conglomerate with business in the carbon, steel, and pharmaceuticals, will invest in the airline component.[8]
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