Search for airline partners goes on - ResearchInChina
Date:2008-03-04
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CHINA Eastern Airlines Corp (stock code: 600115) )will continue seeking strategic investors to boost its air transport business and make it more competitive, said Li Jun , its vice president, yesterday.
"Our goal remains unchanged. China Eastern is persistent in bringing in strategic investors to upgrade corporate management, improve capital structure and make the company more competitive," Li said in an interview with Xinhua news agency in Beijing.
China Eastern is actively pursuing cooperation opportunities with Shanghai Airlines and Eva Airways Corp of Taiwan, he added.
China Eastern wants a strategic partner after posting losses in 2005 and 2006.
The firm rejected a wide-ranging alliance proposal from China National Aviation Corp (Group) on February 26, a move analysts said could close the door for an alliance between the Shanghai-based carrier and Air China, the country's third and second largest airlines, respectively, by fleet size.
On January 8, CNAC successfully blocked China Eastern's proposed sale of 1.88 billion H shares, or a 24-percent stake, at HK$3.80 (49 US cents) a share to Singapore Airlines and the city-state's investment arm Temasek Holdings. CNAC has offered to buy as much 30 percent of China Eastern for HK$5 per share.
A CNAC source said yesterday the company "has always been sincere about the possible establishment of a strategic partnership with China Eastern, and hopes its board will study the proposal earnestly and consider it prudently ".
China's aviation regulator won't interfere in China Eastern's share sale, Li Jiaxiang, head of the General Administration of Civil Aviation, said in Beijing yesterday.
"Selling a stake is a company activity," he said.
Shares of China Eastern fell to the lowest in six months in Hong Kong trading when they dropped 3.2 percent to HK$4.88. Air China fell 2.1 percent to HK$7.39.
In Shanghai, China Eastern rose 3.7 percent to 15.85 yuan (US$2.23), with Air China jumping 5.7 percent to 20.50 yuan.The benchmark CSI 300 Index, which tracks yuan-denominated A shares listed on China's two exchanges, closed 2.5 percent higher.
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