INVESTMENT BANKING | Staff Reporter, China

China probes top deal-making companies to gauge risks of litigation, losses at banks

HNA’s acquisition of Travana is amongst the deals being examined.

Bloomberg reported that China’s banking regulator, which has asked local lenders to provide loan information on the country’s top deal-making companies, is examining examples of acquisitions gone awry by those firms to assess potential risks to the financial sector, people familiar with the matter said.

The China Banking Regulatory Commission is seeking to gauge how much risk Chinese banks face by lending funds to Anbang Insurance Group Co., Dalian Wanda Group Co., Fosun International Ltd., HNA Group Co., and the Chinese buyer of the AC Milan soccer club, the people said, asking not to be identified because the matter is private. Specifically, the regulator is seeking to assess the likelihood of litigation costs, potential losses to banks if the deals sour and whether enough due diligence was conducted, the people said.

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