Qatar Airways buys near 10% Cathay Pacific stake

[ad_1]

Cathay Pacific planesImage copyright
Getty Images

Qatar Airways will buy a near 10% stake of Cathay Pacific for HK$5.6bn ($662m; £506m), giving the Middle Eastern airline more access to China’s lucrative aviation market.

Cathay Pacific shares lost ground in Hong Kong on Monday following the deal.

It’s the first known investment by a Middle Eastern airline into an east Asian carrier.

China is the world’s fastest growing aviation market and is set to be the largest by 2022.

As a result of the deal, Qatar Airways has become Cathay Pacific’s third largest shareholder.

In a statement, the Hong Kong based airline said Air China and Swire Pacific would continue to hold nearly 75% of its shares.

The acquisition is set to help Qatar Airways grow its slice of the vast Chinese aviation market.

Last month, the International Air Transport Association brought forward its forecast for when China would overtake the US as the world’s largest aviation market by two years.

Image copyright
Getty Images

Image caption

More than 400,000 Chinese mainland tourists travelled to Hong Kong during Golden Week

‘Constructive relationship’

Both airlines have hailed the benefits of the acquisition.

Cathay Pacific chief executive Rupert Hogg said as members of the Oneworld alliance, “we look forward to a continued constructive relationship”.

Qatar Airways chief executive Akbar Al Baker said Cathay Pacific is “respected throughout the industry with massive potential for the future”.

Mr Al Baker added the investment “further supports Qatar Airways investment strategy”.

Qatar Airways’ investments include:

  • 20% stake in Anglo-Spanish multinational airline IAG
  • 10% stake in South America’s LATAM Airlines Group
  • 49% in the privately owned Italian airline Meridiana

After falling nearly 5%, Cathay Pacific’s shares trimmed losses and were down around 1.5% in afternoon trading in Hong Kong.

The acquisition is expected to be finalised on Monday.

[ad_2]

Source link

Leave a Reply

Your email address will not be published. Required fields are marked *