The resignation of HNA Group's chairman has caused some to
speculate that Hainan Airlines Co, China's fourth largest carrier,
may quit the stock market. Hainan Airlines is parented by HNA.
Chen Feng resigned from the HNA board, Hainan Airlines Co said
in a statement filed to the Shanghai Stock Exchange yesterday.
Chairman secretary Zhang Shanghui said Chen has accepted a position
as chairman of Grand China Air.
Chen said earlier HNA's restructuring plan was approved by the
General Administration of Civil Aviation and the group is likely to
complete the restructuring by the end of the year.
The restructuring will create a flagship carrier, Grand China
Air, a combination of four of HNA's major airlines?- Hainan
Airlines, Xinhua Airlines, Shanxi Airlines and Changan Airlines.
Grand China Air is seeking overseas listing next year.
The Hainan government is the largest shareholder in Grand China
Air with a 48.61 percent stake. Financer George Soros holds 18.64
percent, and HNA and its subsidiaries own the remainder.
It is still unknown if the launch of Grand China Air will lead
to Hainan Airlines Co's market exit, according to an HNA Group
source. Although HNA said Chen's departure would not affect the
group, it still drew attention to Hainan Airlines' shares.
In June 2006, Grand China bought 1.65 billion of Hainan
Airlines’ newly issued 2.8 billion shares, accounting for 46.7
percent of the enlarged capital Hainan Airlines raised 5.6 billion
yuan (US$750 million) through issuing the shares and Grand China
became the controlling shareholder.
As of October 31, the five airlines listed on the domestic stock
markets had all released their third-quarter results. Hainan
Airlines ranked fourth, with earnings per share of 0.119 yuan and
lagging far behind the top three.
(Chinadaily.com.cn November 2, 2007)
