China’s fourth-largest airline group, Hainan Airlines, is finalising details of a long-planned restructuring that will see it rebranded Grand China Airlines. It is also aiming to secure a listing on the Hong Kong stock exchange.
Fast-growing Hainan, which is listed domestically in Shanghai, recently secured additional investment from a company controlled by American financier and Hainan shareholder George Soros. Hainan executives say Soros has agreed to invest another $25 million into the airline which will be used to help it restructure. The investment vehicle used by Soros currently has a 15% stake, having bought into the carrier in 1995.
Hainan has been planning a name change for several years aimed at rationalising the group’s identity following the takeover of several other airlines. Carriers in the group now include the main operator Hainan Airlines, which has an extensive domestic network and limited international services, as well as smaller carriers Changan Airlines, Shanxi Airlines and Xinhua Airlines.
Hainan says final regulatory approvals have now been secured for the name change. It also says it is proceeding well with a $900 million capital raising plan that was announced earlier this year. It says more than $300 million has been raised so far through the issue of new shares and more than $600 million will have been raised by the end of this year.
The final part of its fund-raising plan should include the sale of shares in Hong Kong followed by a listing on the Hong Kong stock exchange, it says. The three largest Chinese airline groups are already listed in Hong Kong.
Hainan has grown rapidly since it was established in the early 1990s. It was the first Chinese airline to be listed on a stock exchange and the first to have foreign ownership.
Source: Airline Business
