BEIJING, Jan. 9 -- China Eastern Chairman Li Fenghua reiterated that the
company will not merge or restructure with Air China under any circumstances,
after a sales proposal to sell stakes to Singapore Airlines was rejected by 77.6
percent shareholders on Tuesday.
”°China Eastern and Air China are at the same level in terms of operation,
management and market performance, so we will not consider introducing Air China
as our strategic partner no matter how high the price they can offer,”± said Li
at a press briefing after the shareholders meeting.
Around 77.6
percent of China Eastern's shareholders on Tuesday rejected a proposed sale of
24 percent stake to Singapore Airlines and Lentor investment Pte Ltd, a wholly
owned subsidiary of Temasek.
Many shareholders have expressed their objections in the three-hour
shareholders meeting held in Shanghai Hangyou Hotel, near China Eastern's
headquarters.
An attendee surnamed Ji who represents minor shareholders holding 600,000 H
shares of China Eastern, said that Singapore Airlines' offer price is too low
and unfair to minor shareholders.
Yang Peng from Rongtong Fund Management Co Ltd, the third largest
shareholder of China Eastern's circulating shares, also voted down the deal and
said that China Eastern can consider the proposal of Air China, who offer a
higher price.
Singapore Airlines (SIA) said in a statement yesterday it was
"disappointed" after China Eastern shareholders rejected the deal, but it "will
continue to support the building of a relationship with China Eastern, noting
that the airlines are still mutually willing to develop the relationship”±.
China Eastern signed an agreement to sell a combined 24 percent stake to Singapore
Airlines and Temasek at HK$3.8 on September 2. But CNAC, the parent company
of Air China, which owns 12.07 percent stake in China Eastern, said on Sunday
that it can make a higher offer of 5 HK dollars per share.
CNAC said on Tuesday that it plans to submit a formal offer to China
Eastern within two weeks after shareholders rejected the Singaporean deal.
China Eastern's chairman Li Fenghua said the voting result is within his
expectation because a vast number of shareholders that previously supported the
deal have changed their ideas after CNAC made the offer.
”°We will further study the possibilities for the alliance with Singapore
Airlines and also consider shareholders' suggestions,”± said Li.
Li said that the price is not a major obstacle. ”°If Singapore Airlines
raise the price, Air China may follow suit to offer a much higher price, which
is not an effective way to solve the current problem,”± said Li, adding that
China Eastern will mull over further plan to act against the CNAC bid, but
declined to elaborate.
Analysts said that the result is within their expectation because of Air
China's higher offering prices. Air China aims to gain a leading position in
Shanghai, which is expected to build into an international aviation hub,
analysts said.
China Eastern accounts for 35 percent of aviation market in Shanghai,
followed by 18 percent of Shanghai Airlines and 12 percent of Air China.
”°Air China's market share is expected to soar to 50 percent if it succeeds
in the possible merger with China Eastern,”± said Zheng Qingping, an analyst at
Tebon Securities.
”°All airline companies are striving to gain more market share in Shanghai,
with the increasing importance of the city in the international aviation
market,”± said Zheng.
(Source: China
Daily)
Shareholders reject China Eastern's
SIA deal for low offer
price
SINGAPORE, Jan. 8
(Xinhua) -- Singapore Airlines (SIA) quickly expressed its disappointment
Tuesday over the shareholders' rejection of its investment in China Eastern
Airlines (CEA).
The Singapore flag carrier said in a statement that
"Singapore Airlines is disappointed that the proposed transaction involving an
equity stake in China Eastern Airlines did not receive the required level of
support from independent shareholders at today's EGM (extraordinary general
meeting)." Full story
Shareholders reject China Eastern's
SIA deal for low offer price
SHANGHAI, Jan. 8 (Xinhua) -- China Eastern Airlines (CEA)
shareholders rejected its planned 24 percent stake sale to Singapore Airlines
(SIA) during a vote in Shanghai on Tuesday.
More than 74 percent of the minority H shareholders and 77
percent of the minority A shareholders voted against the tie-up as they deemed
the offer price of 3.8 Hong Kong dollars (48 U.S. cents) as too low. Full story
Eastern's SIA deal looks uncertain
following Air China counter-bid
BEIJING, Jan. 7 (Xinhua) -- The outcome of a vote to
approve China Eastern Airlines' (CEA) sale of a stake to Singapore Airlines
(SIA), scheduled on Tuesday, is up in the air after a major shareholder made a
counter-bid, effectively voting against the deal.
China National Aviation Corporation (Group), or CNAC, said
in a statement late Sunday that it would offer at least 5 Hong Kong dollars
(0.64 U.S. dollars) a share for the stake in CEA if shareholders rejected SIA's
bid of 3.8 Hong Kong dollars apiece. Full story
CNAC offers higher price for Eastern
BEIJING, Jan. 7 -- The parent company of the nation's
largest airline company, Air China, said yesterday it plans a make a counter
offer of HK$5 per share - or a third more - for China Eastern Airlines if
shareholders rejected a Singaporean deal.
In a statement last night, China National Aviation
Corp (CNAC), which owns 12 percent of China Eastern's Hong Kong-listed shares,
said it would submit a bid within two weeks if Tuesday's shareholding meetings
rejected China Eastern's union with Singapore Airlines and Singaporean
investment agency Temasek. Full story
