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Business deals

Leading Hong Kong tycoons turn their backs on jet leasing

Cheng and Li families say time to exit 'volatile' sector

The aviation sector, particularly in Hong Kong, has been hard hit by the COVID pandemic. (Photo by Kenji Kawase)

HONG KONG -- Hong Kong tycoons Li Ka-shing and Henry Cheng are both retreating from aircraft leasing, a business into which they had steered their wide-ranging conglomerates over the past decade to diversify risk and revenues globally.

The COVID pandemic hit the sector hard, as airlines with few passengers struggled to keep up with lease payments or went out of business. The Ukraine war has added to lessors' woes, with Western sanctions compelling many of the finance companies to ask for their planes back from Russian clients while Moscow restricts them from leaving. Against this backdrop, the sector is seeing a new wave of consolidation.

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