(Yicai Global) May 21 -- Chinese investment holding company AJ Group said it will contribute up to CNY4 billion (USD621.5 million) to join a consortium led by Juneyao Airlines that is said to be interested in the aviation assets of bankrupt HNA Group, which include Hainan Airlines.

AJ plans to join Jidaohang Airlines Technology Partnership, boosting its overall funding to as much as CNY30 billion (USD4.66 billion), the Shanghai-based company said in a statement late yesterday. HNA’s aviation assets are the target, a person familiar with the matter told Yicai Global.

Juneyao Airlines plans to stump up CNY5 billion for the consortium whose formation it announced late last month. Then two days ago, Shanghai-based Yuyuan Tourist, a unit of Chinese conglomerate Fosun International, said it was setting up a similar fund, contributing CNY10 billion toward its CNY40 billion, which is also said to target HNA’s aviation assets.

AJ’s shares [SHA: 600643] closed 1.9 percent higher today at CNY7.03 (USD1.09) each, after earlier surging as much as 7.8 percent. The broader Shanghai Composite Index lost 0.6 percent. Hainan Airlines [SHA: 600221] also fell 0.6 percent to CNY1.80, while Juneyao Airlines [SHA: 603885] dropped 2.7 percent to CNY15.51.

AJ and Juneyao Air are both controlled by Juneyao Group.

The Hainan High People’s Court declared Haikou-based HNA bankrupt in March and ordered it to begin restructuring. An overaggressive diversification drive saw the aviation-to-financial services group run up debts of USD94 billion by 2017.

HNA has nearly 670 commercial planes, and operates more than 1,500 routes. It holds 12 domestic and two overseas passenger carrier licenses, as well as four cargo permits. It employed 64,000 people in its airline business as of last year.

Four potential investors have offered to negotiate with HNA for its aviation assets, Yicai Global learned at Hainan Airlines' first creditor meeting. They hoped to pick the final bidders by June. 

Editor: Tang Shihua, Emmi Laine