Source: The Standard Author: Kathy Wang 12/13/2007
Subject Concerned: Airlines
The parent company of Air China may vote against Singapore Airlines' purchase of a stake in China Eastern Airlines.
With the final voting date of January 8 approaching, the decision to derail the deal "depends on whether cooperation between the two airlines will bring benefits to minority shareholders," Bloomberg quoted Air China chairman Li Jiaxiang as saying.
Singapore Airlines won't raise its offer, even if there is a counterbid, the company's chief executive officer Chew Choon Seng said.
Air China's parent company, state-owned China National Aviation Holding Co, increased its stake in China Eastern Airlines to 12.07 percent from 11.79 percent through buying Hong Kong-listed shares at HK$7.58 apiece on November 29. China National increased its H-share stake in the company to 11.02 percent from 10.07 percent in early September.
China Eastern's Hong Kong and mainland-listed shareholders will vote simultaneously in Shanghai on January 8 on the proposal to sell a stake to Singapore Airlines at HK$3.80 per share. Air China needs at least one-third of votes to block the deal.
Singapore Airlines and its parent, Temasek Holdings, signed definitive agreements to buy an aggregate stake of 24 percent in China Eastern Airlines on November 9.