Stocks News
- Eastern Air holders to vote on stake sale
Date: 27-Nov-2007 Sources: (Shenzhen Daily)
CHINA Eastern Airlines Corp.'s shareholders are scheduled to vote in Shanghai on Jan. 8 on the company's plan to sell a 24 percent stake to Singapore Airlines Ltd. and Temasek Holdings Pte., the Hong Kong and Shanghai-listed carrier said yesterday.
China Eastern Airlines said in a statement that holders of both its Hong Kong and Shanghai-listed shares will vote at the same time in what is likely to be the final step in completing the stake sale.
Questions about the success of the deal arose in September when it emerged State-owned China National Aviation Holding Co. (CNAHC), a minority shareholder in China Eastern, and Hong Kong's Cathay Pacific Airways Ltd. were putting together a counteroffer.
However, CNAHC, the parent company of Air China Ltd., and Cathay Pacific soon aborted their plan. A person familiar with the situation said at the time Chinese regulators had blocked it from proceeding.
Analysts said getting holders of China Eastern's Hong Kong and Shanghai shares to vote at the same time will make it difficult for minority shareholders like CNAHC to vote down the proposal. China Eastern will need a two-thirds majority vote from its shareholders for the stake sale to be ratified. China Eastern and its parent, China Eastern Air Holding Co., won't be allowed to vote.
Goldman Sachs said in a research note that CNAHC's 11.02 percent stake in China Eastern's Hong Kong-listed shares represents only 3.5 percent of the company's total issued shares.
CNAHC said in September it wouldn't attempt another stake purchase in China Eastern for three months, until Dec. 18. Last week, Cathay Pacific chief executive Tony Tyler declined to say whether his airline had been approached by CNAHC or Air China on further attempts to block Singapore Air's deal.
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