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Beijing bails out Air China Cargo to tune of US$320 million
IN a bid to improve the performance of its main cargo business and cut operating costs, loss-making Air China Cargo (ACC) is being awarded a CNY2 billion (US$320 million) bailout from shareholders Cathay Pacific, Air China and Fine Star.
Operating 13 wide body freighters, the airline is mainland China's largest all-cargo airline. However, it reported a net annual loss last year of CNY349 million.
In a filing to the Hong Kong Stock Exchange, Cathay Pacific confirmed it was injecting CNY500 million into ACC, with CNY1 billion coming from ACC's biggest shareholder Air China and CNY500 million from Fine Star.
Cathay said the objective of the capital injection was "to provide funds to assist Air China Cargo to adjust its fleet, to reduce its operating costs and to improve the performance of its main cargo business," reported Lloyd's List.
"In addition, the capital injection will assist Air China Cargo to develop its cargo charter flight business with China Postal Airlines and to establish a sound and sustainable basis for the development of its overall business."
Air China Cargo has five Boeing 777 freighters on order for delivery by the end of 2015.
Operating 13 wide body freighters, the airline is mainland China's largest all-cargo airline. However, it reported a net annual loss last year of CNY349 million.
In a filing to the Hong Kong Stock Exchange, Cathay Pacific confirmed it was injecting CNY500 million into ACC, with CNY1 billion coming from ACC's biggest shareholder Air China and CNY500 million from Fine Star.
Cathay said the objective of the capital injection was "to provide funds to assist Air China Cargo to adjust its fleet, to reduce its operating costs and to improve the performance of its main cargo business," reported Lloyd's List.
"In addition, the capital injection will assist Air China Cargo to develop its cargo charter flight business with China Postal Airlines and to establish a sound and sustainable basis for the development of its overall business."
Air China Cargo has five Boeing 777 freighters on order for delivery by the end of 2015.
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