Singapore (XFNews-ASIA) - Singapore Airlines (SIA) was higher after a China newspaper reported that the carrier is currently conducting due diligence on China Eastern Airlines Corp Ltd for a possible strategic investment in the Chinese carrier, dealers said.
The China Business News cited unnamed sources as saying the due diligence is expected to be completed by the end of this month, after which both companies will decide whether to sign an agreement depending on the results.
"If you look at the China aviation market it's pretty exciting. The domestic routes are pretty much protected," DBS Vickers analyst Paul Yong said.
But Yong added that as to whether a deal materializes or not will depend on the pricing.
"SIA has a pretty strong balance sheet. They have (easy) access to capital markets," he said.
The Singapore flag carrier has said it is always on the lookout for possible investment opportunities.
"We always have general discussions with a lot of airlines for possible opportunities, and of course China is one market we look at," SIA public affairs manager Teo Lay Cheng said. "But at this point in time we have no current decisions there right now."