Investing.com - Embattled Hong Kong Airlines had seven of its planes seized by a major creditor on Monday to protect “its financial interests,” according to a statement released on Monday.
“The AAHK has acted…to detain seven idle aircraft of Hong Kong Airlines in order to protect financial interests,” the Airport Authority Hong Kong (AAHK) said.
The seizure was made in accordance to the Airport Authority Ordinance, which allows the authority to sell the planes if it is not repaid within 60 days of the detention.
The cash-strapped carrier, which is the city’s third biggest airline, was reportedly on the brink of collapse but received funding two weeks ago to ensure its survival for now.
The AAHK deemed the airline’s financial situation had “deteriorated rapidly” as it could not pay its staff on time last month.
Most of the planes affected this week are owned by a leasing company linked to HKA’s controlling shareholder, HNA Group, South China Morning Post reported citing industry data.