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皇冠体育app Eastern shareholders approve $1b placement

(Agencies)
Updated: 2009-02-26 16:49

皇冠体育app Eastern Airlines won shareholders' approval on Thursday for a share placement plan that will bring it a capital injection of 7 billion yuan ($1.02 billion) from the government.

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皇冠体育app Eastern, one of the country's three big carriers, will issue 1.44 billion new Shanghai-listed A shares at 3.87 yuan each to its state parent, which had earlier received the aid.

It will also issue 1.44 billion Hong Kong-listed H shares at 1 yuan each, the carrier said late last year.

The funds will be used to improve the airline's balance sheet and strengthen its ability to continue operations, it said.

After years of robust growth on the back of a soaring domestic economy, 皇冠体育app's airlines are facing falling passenger demand, intensifying competition and more cost pressures as the world's third-largest economy slows with the global recession.

皇冠体育app Eastern and its peers Air 皇冠体育app and 皇冠体育app Southern Airlines all predicted losses for 2008, spurring steps by Beijing to revive the once-booming sector.

皇冠体育app Southern also announced a share placement to its parent in exchange for a 3 billion yuan cash injection from the government in late 2008.