[photopress:singapore_business_class_new.jpg,full,alignright]China’s state-run Caijing magazine reports China Eastern Airlines’ board has approved the sale of a 24% stake to Singapore Airlines and Singapore’s Temasek Holdings. No-one is denying or confirming the story but, on balance, it seems very probable.
It is reported the board of Shanghai-based China Eastern, China’s third-biggest carrier, has approved the sale.
Singapore International Airlines will pay 4.7 billion Hong Kong dollars which is about the same in RMB ($602 million) for 1.24 billion Hong Kong shares in China Eastern, representing a 15.8% stake.
Temasek, an investment arm of the Singaporean government, would pay HK$640 million for an 8.2% stake. Together that is a 24% stake in the airline.
Staff at China Eastern Airlines’ headquarters said the company had no official comment but would release a statement when it was ready.
Stephen Forshaw, spokesman for Singapore Airlines said, ‘Discussions with China Eastern are ongoing, but there has been no agreement reached.’
In fact, is saying that he may have been a little behind the times because the report is the deal at the Singapore end is signed and sealed. There are just some formalities to go through with the Chinese government.
China Eastern, the China’s only listed carrier to post a loss last year, has been seeking a partner to help it compete with Cathay Pacific Airways and Air China.
Caijing quoted its source as saying that the board of Eastern Airlines Group has approved the revised plan and that the regulators have given their initial approval, but that the plan is awaiting final approval by the state-owned assets regulator and the securities regulator.