Air China's parent company has bid for a stake in rival China
Eastern Airlines after Singapore Airlines HK$3.80 (49 US cents) a
share offer was rejected.
China National Aviation Holding Co proposed to become "alliance
partners" with China Eastern, China National Aviation said
yesterday. Details of the offer will be announced on January
22.
Air China, the world's largest airline by market value, and
affiliate Cathay Pacific Airways, are seeking a tie-up with
Shanghai-based China Eastern to dominate the world's second-largest
aviation market.
China National Aviation had indicated it will offer at least
HK$5 a share, after minority shareholders rejected Singapore Air's
bid.
"I see greater possibility for China National Aviation to win
the bid," Li Lei, an analyst at China Securities, told
Bloomberg News yesterday in Beijing.
"I don't think Singapore Airlines can work out a counter-bid in
such short time, given the approval procedures from shareholders
and Chinese industry regulators."
China Eastern spokesman Luo Zhuping wasn't immediately available
yesterday for comment.
China National Aviation said on January 6 that it may seek to
buy as much as 30 percent of China Eastern.
The company may also propose a cargo venture between the two
carriers and Hong Kong-based Cathay Pacific, people familiar with
the negotiations said on January 11.
Chinese carriers have a 44-percent share of the nation's
international passenger market and less than 20 percent of its
international cargo market.
(Shanghai Daily January 20, 2008)
