CHINA: Air China keeps Air China Cargo in its sights

Air China continues to negotiate with Beijing Capital Airport to purchase the latter’s 24 per cent stake in Air China Cargo, the country’s largest cargo carrier. In December, Air China announced plans to raise its stake in Air China Cargo to 76 per cent from 51 per cent through the purchase of Gold Leaf Enterprise […]


Air China continues to negotiate with Beijing Capital Airport to purchase the latter’s 24 per cent stake in Air China Cargo, the country’s largest cargo carrier.

In December, Air China announced plans to raise its stake in Air China Cargo to 76 per cent from 51 per cent through the purchase of Gold Leaf Enterprise Holdings’ stake in Air China Cargo shareholder Langxing Co.

Beijing-based Air China Cargo has suffered operating losses in recent years and reported a net loss of RMB382 million (US$55.4 million) in the first nine months of 2007. Subsequently the carrier has increased its capacity in the booming Shanghai market and floated the possibility of a cargo joint venture with China Eastern Airlines.

Meanwhile, Cathay Pacific chief executive Tony Tyler has expressed the carrier’s commitment to help fund any bid by Air China for China Eastern Airlines. The move is widely seen as an attempt to ensure its 17.5 per cent stake in Air China remains viable, as well as strengthen Cathay’s presence in Shanghai where China Eastern is based.