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January 17, 2008 |
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CHINA EASTERN: Says No Further Comment on Air China Tie-Up China Eastern Airlines said on Tuesday that it would make no further comment regarding a tie-up with Air China before any detailed proposal, Reuters reports. "The market is waiting to see what Air China can bring to the table. There is no point speculating what our reaction will be before the proposal actually comes out," Reuters quotes China Eastern spokesman Luo Zhuping as saying. As reported by the Troubled Company Reporter-Asia Pacific on Jan. 10, 2008, shareholders of China Eastern rejected a bid by Singapore Airlines to buy a minority stake after Air China's parent, China National Aviation Holding Co., pledged a higher offer. Specifically, CNAHC vowed to pay at least HK$5.00 a share, or at least 32% more than Singapore Airlines' and Temasek Holding Pte Ltd's bid of HK$3.80 per share, or HK$7.2 billion (US$923 million) in aggregate, for a holding in China Eastern. After the rejection, the TCRAP stated, Air China said it will make a rival proposal for a stake in China Eastern. China Eastern, however, expressed that it would not consider having Air China as a strategic investor. Reuters recalls that the Beijing News, however, earlier quoted Mr. Luo as indicating that China Eastern was softening its stance and was prepared to consider a partnership with Air China. In addition, the TCR-AP reported on Jan. 16 that sources told China Knowledge that China Eastern and Air China were discussing an alliance plan that involve a swapping of shares. However, Mr. Luo clarified with Reuters that China Eastern's position had not changed since the shareholders meeting. Headquartered in Shanghai, China, China Eastern Airlines Corporation Limited's -- http://www.ce-air.com -- principal activity is operation of domestic and international commercial air transportation. The Group also is involved in the common aircraft industry. Other activities include general aviation, air catering, advertisement, import and export, equipment manufacturing, real estate, hotel business, finance and training. The fleet includes more than 60 large and medium size airplanes, Airbus and Boeing mostly. Its operation centering from Shanghai to the whole People's Republic of China and linking to Asia, Europe, America and Australia. On April 28, 2006, Fitch Ratings downgraded China Eastern's foreign currency and local currency issuer default ratings to B+ from BB-. The outlook on the IDRs is stable. Xinhua Far East China Ratings gave the company a BB+ issuer credit rating. |
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