Hong Kong
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Qatar Airways will promote its stake in Cathay Pacific Airways for $896 million, ending its eight-year shareholding in Hong Kong’s flagship service.
The Doha-based airline approached Cathay about promoting its total 9.6% holding, which Cathay will purchase again at $1.4 per share – topic to the approval of its unbiased shareholders, in response to its Wednesday filing.
The state-owned flag service of Qatar turned Cathay’s third-largest shareholder in 2017 when it acquired the stake from Hong Kong-based Kingboard Chemical Holdings and different corporations for $662 million. The buy was the primary funding by a Middle Eastern service in an East Asian airline.
“Following a period of record profitability and strong performance, this decision is part of a proactive strategy to optimise our investments and position the group for long-term growth,” mentioned Qatar Airways CEO Badr Mohammed Al-Meer in a statement released by Cathay on Wednesday.
Upon the completion of the buyback, the holdings of Cathay’s two largest shareholders, Swire Pacific and Air China, will improve to 47.7% and 37.8%, respectively.
Cathay’s chairman Patrick Healy mentioned the buyback displays the corporate’s “confidence” in its future, stressing its dedication to development by way of a $12.9 billion funding in its fleet and lounges over the course of seven years, as introduced final 12 months.
Cathay and Qatar mentioned they may proceed to collaborate by way of present codeshare and alliance agreements. Both airways are members of Oneworld, one of the three main international airline alliances.
Qatar Airways has invested in a number of airways all over the world over the past decade. In 2019, it bought a 5% stake in China’s largest service, China Southern Airlines, shares it continues to retain. The Qatari firm additionally owns a 25% share of the International Airlines Group, the dad or mum of British Airways, Spain’s Iberia, Ireland’s Aer Lingus and different, lower-cost carriers.
Earlier this 12 months, it purchased a 25% stake in Virgin Australia, and it’s within the remaining levels of finishing a 49% fairness funding into Rwandan flag service RwandAir.