BEIJING – Air China Limited (HK:00753) announced Thursday it will contribute RMB2.08 billion to an equity financing round for its subsidiary Shenzhen Airlines, maintaining its 51% ownership stake in the carrier.
The financing, part of a larger RMB16 billion capital raising effort for Shenzhen Airlines, will include RMB2 billion from new investor Shenzhen Kunhang Investment Partnership, according to a company statement. Kunhang Investment will acquire a 20.91% stake in Shenzhen Airlines through this transaction.
The deal values Shenzhen Airlines at approximately RMB5.48 billion, based on a valuation report from China Enterprise Appraisals with a reference date of September 30, 2024.
Upon completion of this initial financing stage, Air China will maintain its controlling 51% interest in Shenzhen Airlines, while existing shareholder Shenzhen International Logistics will see its stake reduced to 28.09%.
The transaction will increase Shenzhen Airlines’ registered capital to RMB9.35 billion. Air China stated that the corporate governance structure, including board composition and decision-making mechanisms, will remain unchanged after the financing.
Both Air China and Kunhang Investment will make their capital contributions in one-time lump-sum cash payments within 10 business days from the effective date of the agreement. Shenzhen Airlines will then update its register of members and amend its articles of association.
Kunhang Investment is a limited partnership controlled by the State-owned Assets Supervision and Administration Commission of Shenzhen Municipal People’s Government, according to the announcement.
Air China noted that subsequent financing stages will follow, with the company maintaining its 51% ownership position in Shenzhen Airlines throughout the entire RMB16 billion capital raising process.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.