Cathay Pacific Airways has expressed its support for any
possible plan by Air China's parent to bid for China Eastern
Airlines.
Tony Tyler, chief executive of the Hong Kong flagship airline,
said on Wednesday that the carrier is happy to support any proposal
Air China's parent - China National Aviation Holding Company - may
have.
Cathay and China National Aviation, which hold stakes in each
other, are seeking a tie-up with Shanghai-based China Eastern in
bid to dominate the world's second-largest aviation market.
China National Aviation last week successfully blocked China
Eastern's plan to sell a 24-percent stake to Singapore Airlines and
its parent Temasek Holdings Pte in a HK$7.16-billion deal by
offering a much higher bid price.
China National Aviation, which owns 12.07 percent of China
Eastern's H-shares, said it will offer at least HK$5 per share,
compared with SIA's HK$3.80, for up to 30 percent of the
Shanghai-based airline. China National Aviation will reveal the
bidding plan by January 22 - two weeks after China Eastern's
minority shareholders killed the SIA deal.
But there seems some confusion over whether Chinese Eastern, the
country's third-largest carrier, will accept China National
Aviation as a partner. When the carrier's stance seemed to soften
after a remark by an unidentified official that it may seriously
study the bidding plan, Luo Zhuping, board secretary of China
Eastern, denied the remark and insisted it won't accept China
National Aviation as a strategic investor.
An official of China National Aviation was reported by the media
as saying that the bidding plan has been drafted and is going
through certain proceedings, and it will be revealed as
scheduled.
"The plan must get approval from its major shareholder - the
State-owned Assets Supervision and Administration Commission of the
State Council, and China National Aviation should also seek
opinions from the General Administration of Civil Aviation of
China," said Li Lei, an analyst at China Securities Co.
Ma Xiaoli, an analyst at CITIC Securities Co, said the
possibility of the two Chinese carriers cooperating is growing
after the former chairman of Air China, Li Jiaxiang, was named to
head CAAC, the aviation industry regulator, and SASAC changed its
support for the Singapore deal to neutral.
(Shanghai Daily January 18, 2008)
