Nicholas Ionides/SINGAPORE
Hainan Airlines has advanced its aim of becoming China's main independent carrier, securing a tentative deal to steal Shanxi Airlines away from rival Shandong Airlines. Jinan-based Shandong announced in October that it was seeking to buy Taiyuan-based Shanxi, but revealed on 9 May that the deal had fallen apart.
Hainan moved quickly, securing a tentative take-over agreement that will probably include the replacement of Shanxi's fleet of three Xian Aircraft Y-7s with Fairchild Dornier 328JETs - of which Hainan intends to have 40 by the end of next year. Hainan says a take-over of Shanxi "is the plan", and that a final agreement may be confirmed by the end of this month.
The Civil Aviation Administration of China has been calling for consolidation among the country's 30-plus airlines for some time, and is merging the 10 carriers it directly controls into three groups, headed by Air China, China Eastern Airlines and China Southern Airlines.
Among independent carriers, Hainan has led the way in taking over smaller operators. It acquired Changan Airlines last year and earlier this year took over China Xinhua Airlines.
Shandong, another fast-growing independent, has also pursued expansion through acquisitions, but unsuccessfully. Late last month it agreed a commercial alliance - China Sky Aviation Enterprises - with China Postal Airlines, Shanghai Airlines, Shenzhen Airlines, Sichuan Airlines and Wuhan Airlines, but the deal does not feature equity ties (Flight International, 8-14 May).
Hainan was conspicuously left out of the multilateral tie-up, which aims to establish itself as the country's fourth-biggest airline grouping. It claims to be seeking mergers with other carriers.
Source: Flight International
