BRIEF: Air China sells down Cathay stake, booking $26 million in profit
Air China Ltd. (0753.HK, 601111SH) said on Tuesday that it sold 108 million shares of its holdings in leading Hong Kong airline Cathay Pacific Airways Ltd. (0293.HK) for HK$12.22 per share, raising HK$1.32 billion ($169 million). The divested shares represent 1.61% of Cathay’s total issued share capital.
The sale, through a share placement, represented a 6.64% discount to Cathay’s Monday closing price of HK$13.09 per share. The transaction is expected to generate a pretax profit of approximately 182 million yuan for Air China, one of China’s three major state-owned airlines.
Prior to the sale, Air China held 28.72% of Cathay Pacific’s shares. That figure dropped to 27.11%, or 1.82 billion Cathay Pacific shares, after the sale.
Cathay’s stock opened 0.53% lower on Tuesday at HK$13.02, while Air China opened down 0.84% at HK$7.09. Cathay Pacific’s shares have risen nearly 60% over the past year.
By Lau Chi Hang
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