CA & HX in Talks
#17
Join Date: Sep 2017
Location: Hong Kong
Programs: CX DM/OWE, Marriott Platinum
Posts: 155
Though I still doubt it would be CA to acquire HX since they already own a big part of CX.
CN doesn't usually put its eggs in one basket, and spreads distressed assets into a few companies (e.g. 4 AMCs to bail out the banks in the past, various banks to bail out the securities firms, IPF vs CDB to bail out Anbang/HNA).
Besides HX likely has a complicated ownership structure that could have varying opinions on any deal on the table (think similar to UO), so I wouldn't spend too much time speculating on any one possible deal.
Last edited by sparkj; Mar 12, 2020 at 3:38 am Reason: typo
#18
Join Date: Jun 2005
Location: HKG
Posts: 1,505
When everyone comes begging for $ to survive, I wouldn't rely on that central government strategy to hold every time anymore. We live in extraordinary times these days ..
https://www.scmp.com/business/compan...vid-19-ravages
There won't be enough money to help everyone.
https://www.scmp.com/business/compan...vid-19-ravages
There won't be enough money to help everyone.
#19
Join Date: Jun 2018
Posts: 415
Like many other airlines, CX are trying to preserve cash. Meanwhile, HNA needs cash. CA could hold HX assets but let CX make important decisions for HX.
#20
Original Poster
Join Date: Sep 2005
Location: TPE / HSZ
Programs: CX GO (=SPH), IHG Diamond Amb, Hertz 5*, Accor, Hilton, National
Posts: 6,437
#22
Join Date: Dec 2001
Location: China
Posts: 1,552
#23
Join Date: Jun 2018
Posts: 415
Actually it is the slots. HKG adopted flexible policy on use-it-or-lose-it slot rule from June last year. HX still holds the slots. By the way, the same question is also applied to Hong Kong Express, but you can see how much Cathay would like to pay for that.
#24
Join Date: Jun 2018
Posts: 415
CA can work as a passive investor, or appoint CX management to manage the company. HNA has done that before: sell majority stake of a subsidiary airline to local government, but they reach a deal with the government so that HNA still operates the airline. You can see it as means of financing.
#25
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Join Date: May 2009
Location: HKG
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#26
Original Poster
Join Date: Sep 2005
Location: TPE / HSZ
Programs: CX GO (=SPH), IHG Diamond Amb, Hertz 5*, Accor, Hilton, National
Posts: 6,437
CA can work as a passive investor, or appoint CX management to manage the company. HNA has done that before: sell majority stake of a subsidiary airline to local government, but they reach a deal with the government so that HNA still operates the airline. You can see it as means of financing.
#27
Join Date: Apr 2008
Programs: Confirmed
Posts: 1,091
What would happen to CX if Air China takes Hong Kong Airlines over?
Sources confirmed that as part of the recovery plan for HNA Group, HK Airlines will be sold to CNAC and a consortium of investors. The valuation is agreed and due diligence is in progress.
So far Air China (and the Beijing people) owns 29.99% of CX. I don’t believe mainland investors are allowed to fully own a HK registered airline. This creates a conflict of interest between CX and HX - there are some competition. Plus - how can the regulators be satisfied? Giving up slots/routes at HKG?
If HX is to be injected into CX group, Air China is already holding upper limit of CX shares. I don’t see Swire paying for HX - if they want to buy HX they would have had bought it last November.
So far Air China (and the Beijing people) owns 29.99% of CX. I don’t believe mainland investors are allowed to fully own a HK registered airline. This creates a conflict of interest between CX and HX - there are some competition. Plus - how can the regulators be satisfied? Giving up slots/routes at HKG?
If HX is to be injected into CX group, Air China is already holding upper limit of CX shares. I don’t see Swire paying for HX - if they want to buy HX they would have had bought it last November.
#28
FlyerTalk Evangelist
Join Date: Jul 2006
Location: Hong Kong, France
Programs: FB , BA Gold
Posts: 15,557
Sources confirmed that as part of the recovery plan for HNA Group, HK Airlines will be sold to CNAC and a consortium of investors. The valuation is agreed and due diligence is in progress.
So far Air China (and the Beijing people) owns 29.99% of CX. I don’t believe mainland investors are allowed to fully own a HK registered airline. This creates a conflict of interest between CX and HX - there are some competition. Plus - how can the regulators be satisfied? Giving up slots/routes at HKG?
If HX is to be injected into CX group, Air China is already holding upper limit of CX shares. I don’t see Swire paying for HX - if they want to buy HX they would have had bought it last November.
So far Air China (and the Beijing people) owns 29.99% of CX. I don’t believe mainland investors are allowed to fully own a HK registered airline. This creates a conflict of interest between CX and HX - there are some competition. Plus - how can the regulators be satisfied? Giving up slots/routes at HKG?
If HX is to be injected into CX group, Air China is already holding upper limit of CX shares. I don’t see Swire paying for HX - if they want to buy HX they would have had bought it last November.
#29
Join Date: Apr 2008
Programs: Confirmed
Posts: 1,091
If CA is taking HX over, sell HKG slots to CX at a reasonable price then wind down HX orderly then it seems to be the best use of capital at the moment.
#30
Ambassador, Hong Kong and Macau
Join Date: May 2009
Location: HKG
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While my first impression of the CA takeover of HX was "weird...", I now rationalise it's just really CA probably obtaining the all or majority of HX shares ([b]PPB be damned...). CX (in the ideal case, where minority shareholders' interests are respected) won't share any info flow with CA and CA's shareholding of CX will go totally passive.
Last edited by percysmith; Mar 24, 2020 at 9:58 am