Air China, Cathay Pacific, CITIC Pacific and Swire Pacific Boards announced (17-Aug-09) details of two transactions that will collectively realign their shareholdings in Cathay Pacific. Subject to regulatory approval, CITIC Pacific will sell a 12.5% shareholding in Cathay to Air China for HKD6,335 million (USD817 million), representing a price of HKD12.88 (USD1.66) per Cathay Pacific share. CITIC will also sell a 2% shareholding in Cathay to Swire Pacific for HKD1,013 million (USD131 million). These transactions will increase Air China's stake in Cathay Pacific from 17.49% to 29.99%, while Swire Pacific's stake in Cathay will increase from 39.97% to 41.97%.
Air China and Swire both acquired as much of the CITIC shareholding as possible without triggering mandatory takeover offers, with the acquisitions occuring after "very speedy" talks, according to Swire and Cathay Pacific Chairman, Christopher Pratt. [more][more - Speech] [more - Cathay Pacific]
Air China: "By increasing Air China's shareholding in Cathay Pacific, Air China and Cathay Pacific can form a closer cooperative relationship that will serve as a platform for further cooperation between, and generate greater synergy for, Air China and Cathay Pacific. This increase in shareholding will be useful in terms of boosting the international competitive strengths and brand value of Air China," Company Statement, 17-Aug-09.
Cathay Pacific: "Cathay Pacific is looking forward to working even more closely with Air China to leverage the opportunities that will arise from the strengthening of the ties between two of the world's great international airline brands," Company Statement, 17-Aug-09.
CITIC Pacific: "CITIC Pacific has been honoured to be a large shareholder of Cathay Pacific for many years, during which time the companies have enjoyed a very positive relationship. This disposal is in keeping with CITIC Pacific's plan to focus on its major businesses," Company Statement, 17-Aug-09.
Swire Pacific: "Swire Pacific regards its acquisition of additional shares in Cathay Pacific as confirmation of its full support for Cathay Pacific and confidence in its future as one of the world's leading airlines and of its commitment to enhancing Hong Kong as Asia's premier aviation hub. We welcome the increase in Air China's shareholding in Cathay Pacific, and believe it will serve as a platform for further cooperation between the two carriers," Company Statement, 17-Aug-09.