Airlines' merger receives approval
By Winny Wang |
October 10, 2009, Saturday
|
Print Edition
Print Edition
SHAREHOLDERS of two Shanghai-based airlines have approved their plan to merge their operations which could see them dominate the city's aviation market.
China Eastern Airlines, the country's third-largest carrier, received approval from 99.61 percent of its shareholders, and Shanghai Airlines won support from 96 percent of its shareholders.
"The merger plan has passed an antitrust investigation by the Ministry of Commerce but still requires final approval from the securities regulator," said Liu Shaoyong, chairman of China Eastern, at yesterday's shareholder meeting in Shanghai.
"The two companies will run independently ahead of final approval, but we already have cooperation in some businesses," said Liu. He expected the final approval by the end of this year.
The merger, in which Shanghai Airlines shareholders will exchange one share for 1.3 shares in China Eastern, will boost their market share in the city to more than 50 percent.
The smaller Shanghai Airlines will be delisted from the Shanghai Stock Exchange, and all its assets, including planes and routes, will be transferred to China Eastern.
The takeover will generate synergy on networks, flight schedules, purchase of jet fuel, materials and aircraft, sales outlets and finance.
"The merger is a part of China Eastern's development strategies. We have passed the most difficult period and have been on the development track," Liu said.
China Eastern Airlines, the country's third-largest carrier, received approval from 99.61 percent of its shareholders, and Shanghai Airlines won support from 96 percent of its shareholders.
"The merger plan has passed an antitrust investigation by the Ministry of Commerce but still requires final approval from the securities regulator," said Liu Shaoyong, chairman of China Eastern, at yesterday's shareholder meeting in Shanghai.
"The two companies will run independently ahead of final approval, but we already have cooperation in some businesses," said Liu. He expected the final approval by the end of this year.
The merger, in which Shanghai Airlines shareholders will exchange one share for 1.3 shares in China Eastern, will boost their market share in the city to more than 50 percent.
The smaller Shanghai Airlines will be delisted from the Shanghai Stock Exchange, and all its assets, including planes and routes, will be transferred to China Eastern.
The takeover will generate synergy on networks, flight schedules, purchase of jet fuel, materials and aircraft, sales outlets and finance.
"The merger is a part of China Eastern's development strategies. We have passed the most difficult period and have been on the development track," Liu said.
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