The novel coronavirus pneumonia epidemic seemed like the last straw for debt-ridden Hainan Airlines Group, which turned to the Hainan provincial government for help to survive.

In a public announcement on Saturday, HNA Group said a joint working group was formed by the provincial government to take charge of HNA's risk disposition.

The working group is led by Gu Gang, chairman of the Hainan Development Holdings, and Hainan Yangpu Economic Development Zone management committee director Ren Qinghua serves as the executive deputy head. Deputy head of the CAAC Central and Southern Regional Administration Li Shuangchen and deputy head of China Development Bank's credit management bureau Cheng Gong are deputy heads of the working group.

During a shareholders meeting, HNA Group reelected seven board members, two of whom are from the working group. The board of directors appointed Gu Gang executive-chairman, and Ren Qinghua as co-CEO, Chen Feng retains his position of chairman and Tan Xiangdong as CEO.

"The joint working group is tasked with assisting and promoting HNA Group's risk disposition," said Lin Zhijie, an aviation industry analyst and columnist at civil aviation website carnoc.com.

"It is likely that the leaders of the joint working group will contribute their expertise to accelerate HNA Group's asset disposal and to effectively stabilize its capital flow," Lin said.

According to Lin, Gu and Ren could prescribe the right recipe from the provincial government's point of view; Li may focus on the safety and operation of HNA Group's core business Hainan Airlines, and Cheng of China Development Bank is one of the group's biggest creditors.

Chen Zhuo, a senior analyst at China Merchants Securities, said, "Considering the asset size of HNA Group and its huge amount of employees, it is the right decision for the local government lend a hand".

The working group could improve HNA Group's capital flow by easing financing difficulties in the short term, and accelerate spinning off non-core assets, Chen said.

"The local government's involvement will shore up market confidence towards HNA Group's efforts to wade through the crisis, but everything will be dealt within the framework of the market," China Business News reported.

HNA Group has forayed into global asset purchases in 2015, and expanded its business into various sectors. Its total assets grew nearly 1.3 times in a year and a half, from 542.8 billion yuan (US$77.6 billion) to 1.23 trillion yuan as of the end of 2017, but its liquidity crisis later worsened.

The group has since been seeking solutions to save itself. Its outstanding debt amounted to 706.7 billion yuan as of the first half of 2019.

The COVID-19 epidemic is expected to cost China's aviation sector nearly 37 billion yuan in losses in February, and a further 35 billion yuan loss in March, according to AirSavvi, a Chinese aviation data and solution service provider.