China Eastern shareholders reject SIA's US$923m offer

Jan 8, ChannelNewsAsia

SHANGHAI : China Eastern's ambition of inviting Singapore Airlines on board as a major partner was scuttled by its own shareholders Tuesday, but its chairman angrily said a rival bid from Air China would fail.

Nearly four in five of China Eastern's minority shareholders voted down a proposal to let Singapore Airlines buy a 24 percent stake in the carrier, throwing the battle for the hugely lucrative skies around Shanghai into disarray.

"I regret the deal has been voted down," China Eastern Chairman Li Fenghua told a gathering of shareholders meeting at a hotel near the carrier's headquarters in China's largest city.

Singapore Airlines and investment company Temasek signed a preliminary deal in September to take the stake in China Eastern for US$923 million, or HK$3.80 a share.

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photo: Security guards stand outside the China Eastern Airlines' building in Shanghai