HK unit of Air China's parent goes public in objections to 'unfair' Singapore stake plan
China National Aviation Corp publicly threw down the gauntlet yesterday, saying for the first time that Singapore Airlines' offer to acquire a stake in China Eastern Airlines was unfair to shareholders and it reserved the right to make a counter-proposal.
Analysts said the move by CNAC, the Hong Kong-based subsidiary of Air China's parent, China National Aviation Holding, was part of an effort to mobilise other shareholders to vote against the offer on January 8. In response, China Eastern said it would stick with the original plan to be put to the shareholder vote.
CNAC, which directly holds a 12 per cent stake in China Eastern, said the HK$3.80 offer price did not reflect the fair value of the Shanghai-based airline.
It requested that China Eastern and the bidders present a better proposal. It is the first time that CNAC has publicly described the proposal as unfair to investors.
The CNAC statement comes after Li Jiaxiang, chairman of Air China and its parent company, was appointed on Friday as the new head of the General Administration of Civil Aviation of China.