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Hong Kong-listed Air China confirms to privatize unit CNAC Ltd

23-Jun-2006

HONG KONG (XFNews-ASIA) - Air China Ltd (753.HK) said it is proposing to take unit CNAC Ltd private by way of offering 2.80 hkd a share for the issued shares of CNAC it does not currently own.


The total consideration amounts to 3.23 bln hkd, which will be funded by bank borrowings, Air China and CNAC Ltd said in a joint statement.

Air China currently holds a 68.40 pct stake in CNAC Ltd.  

The offer price of 2.80 hkd represents a 42.1 pct premium to the stock's closing price of 1.97 hkd yesterday.  

Air China said it will also buy CNAC's outstanding options for cancellation by paying 1.66 hkd for each of the 104.38 mln outstanding options.  

Upon the completion of the privatization process, CNAC will will be a wholly-owned subsidiary of Air China and will have its listing withdrawn from the Hong Kong main board.

The privatization plan is expected to be completed in the fourth quarter.  

(1 usd = 7.8 hkd)

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