(Yicai Global) Dec. 9 -- A unit of conglomerate HNA Group is looking to complete its largest asset sale since the Chinese parent's liquidity crisis began in late 2017 to improve its financial status.

HNA Technology aims to sell Ingram Micro, a US-based information technology distributor it bought four years ago, for USD5.9 billion to alleviate its liquidity pressures, according to the Shanghai-listed company's statement released yesterday.

The Chinese parent's main unit would sell the supply chain and cloud solutions provider to Imola Acquisition, a special purpose vehicle backed by US private equity firm Platinum Equity. But the deal is pending board members' and regulatory approvals, it added.

In 2017, Haikou-based HNA Group's liquidity crisis began as huge debt repayment pressure began to mount in the wake of its aggressive campaign of overseas mergers and acquisitions.

HNA Technology plans to sell its IT supply chain service assets to focus on strategic business transformation, it said, without disclosing more details. The competition is becoming fierce in the above-mentioned field amid intensifying industrial consolidation and accelerated rise of local distributors, it added. The firm's asset-liability ratio was 84.5 percent as of Sept. 30, the statement shows.

Tianjin Tianhai Investment, which later changed its name to HNA Technology, bought the California-headquartered firm, which counts Apple, Lenovo, Samsung, and Amazon as some of its clients, for nearly USD6 billion, slightly more than the deal price, in 2016. Ingram Micro had to delist from the New York Stock Exchange after the purchase.

Ingram Micro has been good to the Chinese firm. HNA Technology became its parent's largest unit based on revenues after the firm posted CNY315.5 billion (USD48.2 billion) in annual income in 2017. In 2019, the company made CNY327.2 billion in revenue, driven by Ingram Micro. Its tally was also more than half of the parent's total.

After the acquisition, HNA Technology's asset-to-liability ratio soared. On Dec. 2, the firm said that it has USD1.4 billion worth of overdue loan principle.

HNA Technology had CNY2 billion (USD302.4 million) worth of short-term borrowings and CNY26.5 billion (USD4 billion) worth of long-term borrowings due within a year, per its 2019 annual report. It posted CNY964.7 million (USD147.3 million) in net profit in the first three quarters, a drop in the bucket compared with the huge debt.

HNA Technology's stock price [SHA: 600751] rose 1.9 percent to CNY3.19 (US 50 cents) today.

Editor: Emmi Laine