Virgin Australia is set to sell a 13 per cent stake to China’s largest private airline operator, HNA Group, in a deal which the Australian carrier says will boost its access into the growing Chinese travel market.

HNA Group, which has holdings in more than 10 airlines including Hainan Airlines and Hong Kong Airlines, will make a $159 equity investment in Virgin to take a shareholding of about 13 per cent.

In an announcement on Tuesday, the Australia’s second-biggest airline said HNA Group would increase its stake in the company to 19.99 per cent over time.

Virgin Australia’s chief executive John Borghetti said the airline carrier and HNA Group will introduce direct flights between Australia and a number of Chinese cities.

He was optimistic about a co-operation between the two firms.

“The Chinese travel market represents Australia’s fastest growing and most valuable inbound travel market, with inbound passengers from China increasing by approximately 18 per cent per year since 2010,” Mr Borghetti said.

The development comes as one of Virgin’s major shareholders, Air New Zealand, is looking at a full or partial sale of its 26 per cent stake.

– TiVi Tuan-san