China Eastern adds third cargo firm
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China Eastern Airlines has gained a 51 percent stake in Great Wall Airlines to enhance its presence in the Shanghai cargo market to tap the booming air cargo business.
Beijing Aerospace Satellite Applications Corp, a wholly-owned subsidiary of the state-run China Aerospace Science and Technology Corp, transferred its stake in Great Wall to China Eastern for free.
Great Wall was established by Beijing Aerospace Satellite Applications Corp, Singapore Airlines Cargo and Dahlia Investments, a fully-owned subsidiary of Temasek Holdings, in 2005.
It is based at Shanghai Pudong International Airport.
The deal is part of the state-owned asset regulator's efforts to reduce the number of centrally-administered state-owned enterprises to between 80 and 100 this year.
China Eastern will run three cargo airlines, including Shanghai Airlines Cargo Intl Co and China Cargo Airlines.
"The three airlines will be merged finally but we have yet to map out detailed plans or timetable," China Eastern's Luo Zhuping said.
Cargo turnover in Shanghai is outpacing other markets across the country.
Air China and Cathay Pacific Airways have signed a framework agreement to form a cargo venture in Shanghai.
Both China Eastern and China Southern Airlines have introduced Boeing 777 cargo jets to the Shanghai market eying booming cargo demand.
Cargo volume rose 68.2 percent to 450,726 tons in January in China, while passenger volume gained 11.1 percent, according to the Civil Aviation Administration of China.
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