Air China to take control of Air China Cargo in buyout

AIR China is preparing to take full control of air freight subsidiary Air China Cargo Co Ltd by purchasing the remaining 24 per cent equity interest held by Capital Airports Holding Company. Air China present has a 76 per cent stake in Air China Cargo.

Capital Airports Holding is expected to transfer the remaining 24 per cent stake in the air freight subsidiary with net asset price assessed at CNY798 million (US$116.7 million), reports Xinhua.

The share transfer is said to have received the support from China's State-owned Assets Supervision and Administration Commission of the State Council (SASAC), according to unidentified sources close to the deal.

The insiders said that Air China is likely to establish a joint venture air freight company with Cathay Pacific through Air China Cargo after it gains full control of its Air China Cargo subsidiary.

The report added that Air China Cargo was founded in March 2003 as a joint venture between Air China, which initially held a 51 per cent equity interest in the cargo carrier, Citic Pacific (25 per cent), and Capital Airports Holding Company (24 per cent). Air China later purchased Citic Pacific's 25 per cent interest, raising its stake in the carrier to 76 per cent.

Source: Schednet