Singapore-based online travel agent Zuji has been suspended from selling airline tickets by International Air Transport Association (IATA) after it failed to pay airfare intakes to airlines. The Straits Times reported that Zuji may have to lay off staff and face liquidation.
The company may turn its focus to the Hong Kong market.
Zuji operates a network of business in Australia, New Zealand, Hong Kong, India and Singapore. It was acquired by Australia's largest online travel booking site Webjet for USD 25 million in 2012. The Hong Kong and Singapore units were later sold to travel technology group Uriel Aviation Holding for AU$ 56 million in 2016. Industry insiders believe the HNA Group was behind Uriel Aviation.
In March this year, the HNA-Caissa Travel Group unveiled its asset restructuring plans involving 11 companies, ranging from air transportation to tour operators, online retail, smart marketing, tourism finance and beverage manufacturing. The underlying assets also include Zuji Travel Pte. and Zuji Limited, both specializing in the online reservation of airline tickets and hotel rooms.
Zuji is not the first company acquired by HNA to struggle for survival, as it became apparent that HNA’s ambitious global expansions in recent years made it difficult for the group to build a viable ecosystem.
In March 2017, HNA abruptly closed San Francisco-headquartered online travel agency Travana, after investing USD 27.5 million of the pledged USD 50 million as a majority stakeholder of the company. Creditors of Travana filed for bankruptcy in 2017.
HNA still maintains a presence in the OTA sector, though. It became Tuniu's largest stakeholder after HNA Tourism bought a 24.1% stake in the Nasdaq-listed company for USD 500 million in early 2016. It also launched digital tourism platform HiApp in November 2017 as part of its strategic move into digital transformation.