Source: The Standard Author: 12/24/2007
Subject Concerned: Airlines
China Eastern Airlines chairman Li Fenghua would like all stakeholders to believe that a fellow member of the mainland aviation family would not stand in the way of a deal with Singapore Airlines and its parent Temasek Holdings.
But, as we recall, there had been some grumbling in the Air China camp.
On December 23, Li said in Shenzhen Air China chief Li Jiaxiang had been misquoted and misunderstood by the media.
Brushing off any suggestion of a family squabble, the China Eastern boss insisted that he is confident the deal will be approved by minority shareholders at an extraordinary general meeting to be held on January 8. Some minority shareholders are a little peeved the price for the deal has been set at HK$3.80 per H share. As with most major transactions, not everyone will be happy, of course.
But then, the carriers management is not doing itself any favors either.
In a slip of the tongue Li let it be known that the carrier is junk with a debt ratio of 90 percent. But he quickly put the record straight saying China Eastern is a developing company.
He also said China Eastern is not in a position to negotiate a higher price in this transaction.
We are waiting to see if this deal will fly.