The government-controlled foundation that owns Taiwan's China Airlines (CAL) has revived suspended efforts to privatise the national carrier and says a minority stake will be sold by the end of June.
CAL is 71%-owned by the China Aviation Development Foundation (CADF), which has a mysterious ownership structure but a board dominated by government officials. The CADF says it plans to select soon a financial adviser to assist with the sale, with the intention of initially unloading a 20-30% stake in CAL and more shares later in the year.
CADF chief secretary Lin Chun-cheng says the foundation ultimately wants to reduce its stake to below 35% and allow a strategic investor to take over management.
Taiwan's government promised to revive suspended plans to privatise the airline after last May's crash of a CAL Boeing 747-200 that killed all 225 people on board. The aircraft was flying between Taipei and Hong Kong and broke apart while approaching its cruise altitude. It was CAL's fourth fatal accident since 1994 and led to a shake-up of the CADF's board, which is now led by chairman Lin Ling-san, Taiwan's minister for transport and communications.
Early in 1999, a year after a CAL Airbus A300-600R crashed near Taipei's international airport killing 202 people, the CADF announced its intention to sell half its stake in the airline, in part to bring in foreign management expertise. But a year later the sale was dropped following claims by officials that there was a lack of foreign-airline interest.
China Development Financial Holding (CDFH), one of Taiwan's top financial holding companies, expressed interest in taking control of CAL last year. The group said that it would merge the airline with two smaller Taiwanese carriers, TransAsia Airways and Far Eastern Air Transport.
Source: Airline Business
