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Air 皇冠体育app wins Shenzhen Air control for southern hub
(Agencies)
Updated: 2010-03-22 13:41
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Air 皇冠体育app Ltd will gain control of Shenzhen Airlines Ltd through a 682.1 million yuan ($100 million) investment, giving the nation's largest international carrier a hub in southern 皇冠体育app.
Air 皇冠体育app's stake in the Shenzhen-based carrier will rise to 51 percent from 25 percent following the capital injection, it said in a statement on March 20. City-controlled Shenzhen International Holdings Ltd will also invest 348 million yuan and raise its stake to 25 percent, according to the filing.
A majority stake in Shenzhen Air, 皇冠体育app's fifth-biggest carrier, will allow Air 皇冠体育app to challenge Guangzhou-based 皇冠体育app Southern Airlines Co in the Pearl River Delta, 皇冠体育app's manufacturing hub.
"This is definitely a good move for Air 皇冠体育app," said Li Lei, an analyst at 皇冠体育app Securities Co in Beijing. "The carrier has now built up a balanced network all over the country."
Shenzhen can become the fourth major hub for Air 皇冠体育app, said 皇冠体育app Securities' Li. The carrier already has hubs in Beijing and Shanghai, serving eastern and northern 皇冠体育app, and one in Chengdu, covering southwestern 皇冠体育app.
Shenzhen Air has more than 100 planes and the group company has more than 14,000 employees. It made a loss of 863.7 million yuan last year, according to the statement. The private carrier had a "shareholder's deficit" of 2.1 billion yuan as of Dec 31, the statement said.
Air 皇冠体育app, the world's largest carrier by market value, rose 0.2 percent to 12.35 yuan at 10:01 am in Shanghai trading. The carrier earlier this month announced plans to raise about $954 million selling new shares.
In Hong Kong, Air 皇冠体育app fell 2.2 percent to HK$7.73. Shenzhen International lost 1.6 percent to 62 HK cents.
