Air China to consult advisers for raising its stake in Cathay Pacific

Air China to consult advisers for raising its stake in Cathay Pacific

FILE PHOTO: A Chinese flag flutters outside the China Securities Regulatory Commission (CSRC) building on the Financial Street in Beijing, China February 8, 2024. REUTERS/Florence Lo/File Photo

Air China Ltd. has consulted with advisers in recent months on the possible merits of raising its nearly 30% stake in Cathay Pacific Airways Ltd., Bloomberg News reported on Friday, citing people familiar with the matter.

While it had considered the possibility in the past, including before Covid, Air China’s need to boost profitability has added fresh momentum, though nothing is likely to happen imminently, the report added.

Air China has spoken to lenders to gauge the availability of financing should it eventually decide to proceed with a deal, the report said, adding that considerations are still at a very preliminary stage.

China’s flagship airline is Cathay’s second-largest shareholder, behind manager Swire Pacific Ltd and its 45 per cent stake.

Cathay Pacific said Swire Pacific remains completely committed to the company but declined to provide further details on the stake talks.

Air China did not immediately respond to Reuters’ request for a comment.

Reuters

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