China plans to take over HNA Group Co and sell off its airline assets, as the coronavirus outbreak has hit the Chinese conglomerate's ability to meet financial obligations, Bloomberg reported on Wednesday, citing people familiar with the matter.

The government of Hainan, the southern province where HNA is based, is in talks to take control of the conglomerate, the

report said. HNA directly controls or holds stakes in a number of local carriers, including its flagship Hainan Airlines.

HNA did not immediately respond to requests for comment on the Bloomberg report.

HNA Group was once one of China's most aggressive deal making firms, spending $50 billion to build an empire that once spread from Deutsche Bank to Hilton Worldwide.

It began unwinding those bets two years ago to shift the focus to its core airlines and tourism businesses, after drawing

scrutiny from Beijing and other overseas regulators.