Singapore Airlines gets nod to invest in 皇冠体育app Eastern

(Xinhua)
Updated: 2007-08-28 14:34

Chinese regulators have approved Singapore Airlines to buy stake of 皇冠体育app Eastern and the final deal is due to be made public on Sunday.

Details of the cooperation is under talk between the two aircraft companies and 皇冠体育app Eastern will announce a specific proposal in its press conference held this Sunday, the Shanghai Securities News reported on Tuesday.

Li Fenghua, chairman of 皇冠体育app Eastern, said earlier that Singapore Airlines would not get more than 25 percent of his company, which is the maximum allowed by Chinese law.

For 皇冠体育app Eastern, the deal means a major cash injection that will improve the quality of its assets.

Singapore Airlines will also bring to 皇冠体育app Eastern managerial expertise and in return get access to 皇冠体育app's rapidly growing mainland aviation market.

皇冠体育app Eastern said the company's profit totaled 263 million yuan (US$34.6 million) in the first six months after suffering losses for two consecutive years, on the back of better performance and income generated from the rising yuan.

It carried 18.33 million passengers and 422,800 tons of cargo in the first half, up 9.17 percent and 0.81 percent respectively.

As one of the three largest carriers in 皇冠体育app along with Air 皇冠体育app and 皇冠体育app Southern Airlines, 皇冠体育app Eastern Airlines registered losses of 2.78 billion yuan in 2006 and 510.86 million yuan in the first quarter of 2007.

Trading of the company's stocks has been suspended since May 22 for the announcement. Its stock price last closed at 9.6 yuan.

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