[UPDATED] HNA Group snares 16.79% Dufry share

By Luke Barras-hill |


HNA Group headquarters based in Haikou, Hainan.

In important news, Chinese business conglomerate HNA Group has moved to acquire a 16.79% share of Dufry Group.

In an announcement today, the Swiss retailer said it has been notified by HNA Group that it has exceeded the threshold of 15% due to an agreement with third parties to purchase the share.

The closing of the transaction is subject to certain conditions and further notifications regarding shareholding position can be found on the SIX Swiss Exchange website.

Dufry Group closed its share trading yesterday at CHF159.20.

“We have not been in contact with HNA apart from receiving official confirmation (of the transaction) from the disclosure office,” a spokesperson from Dufry Group told TRBusiness.


Interest in a potential shareholder acquisition was initially raised in a report in The Wall Street Journal last month, which claimed that HNA had approached ‘some existing shareholders’ with stakes in the Basle-based company, including Singapore state investment company Temasek Holdings and Singapore sovereign wealth fund GIC.


Dufry Group’s share price at close yesterday. Source: SIX Swiss Exchange.

Both parties were not immediately available for comment on the new shareholding development when approached by TRBusiness.

As a Fortune Global 500 company based in Haikou, Hainan, HNA Group counts operations in the aviation (Hainan Airlines), tourism, logistics, infrastructure, real estate and financial service sectors, among others in its portfolio.

It’s HNA Tourism arm is one of the top 20 tourism groups in China, and the group also runs Haikou Meilan International Airport where it partners with DFS Group on Hainan Island.

The Wall Street Journal claims follow HNA Group’s announced acquisition of gategroup Holding AG for $1.4bn last April, which was backed unanimously by the gategroup board.

Dufry Group’s share price climbed today (27/04/17) following yesterday’s announcement; at the time of writing (16:00pm UK GMT) it was hovering around CHF160.

While official confirmation of the transaction is unknown, according to SIX Swiss Exchange, “the purchase price has been determined based on market conditions, including a low-double-digit premium and subject to an increase in the case of certain events”.



UBS Investment Research’s chart of Dufry Group’s stock evolution. Click to enlarge.  Source: UBS Group AG first read transaction note. 

As markets take the time to digest the news, it is worth noting that a mandatory tender offer – according to Switzerland’s takeover rules – is not triggered unless a shareholder (or group of shareholders) acquires equity securities and exceeds the 33.33% threshold share of voting rights in the target firm.

For some analysts, the deal represents a potentially sizeable opportunity to capitalise on strengthening market opportunities, particularly in China.

“We think that HNA, with its China roots and local relations, together with Dufry could have the potential to exploit a growing Chinese travel retail market, whose size we estimate at some CHF2-3bn,” UBS analysts Joern Iffert and Gustavo Piras Oliveira told TRBusiness.

“However, we think there would also be some hurdles: (1) the travel retail market is dominated by local companies in China and international companies have not yet received licences to conduct duty-free business in that region; (2) it could be challenging to gain market share from leading local players, including China Duty Free and Sunrise.

“We expect light profitability for Dufry in Q1 17E, which could mildly disappoint some investors. However, with the news of HNA agreeing to take a 16.79% stake, and the possibility of HNA helping Dufry to expand its operations in APAC, we think investor sentiment could yet be supported near term.”

It is categorically unclear whether HNA Group is aiming to gradually bump up its shareholding, or potentially pursue a more definitive takeover of the Swiss travel retailer.


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