China Southern acquires smaller rival
In a filing to the Shanghai Stock Exchange on Tuesday, China Southern said the deal with the Hebei Aviation Investment Group Co Ltd values 680 million yuan ($111 million).
China Southern said its board of directors believed the acquisition will help Xiamen Airlines consolidate its market share in north China and optimize its air routes nationwide.
Hebei Airlines, headquartered in Shijiazhuang, capital of north China's Hebei Province, has a registered capital of 1.8 billion yuan and total assets of 4.2 billion yuan.
In the first eight months of the year, Hebei Airlines reported revenues of 940 million yuan and net loss of 120 million yuan.
China Southern also said in the statement that it will sign a deal with Sichuan Airlines to take a 3.83 percent-stake in Hebei Airlines the small rival holds for 69 million yuan. The two deals are subject to regulatory approvals, it said. After the two deals, Xiamen Airlines will own 99.23 percent of Hebei Airlines. ■