China Eastern admits deal with SIA is very likely
Monday, 19 May 2008: Continuing discussions between Singapore Airlines and China Eastern Airlines indicates that a deal is imminent, as SIA embarks on their second attempt to buy a stake in the Chinese carrier.
China Eastern chairman, Li Fenghua, disclosed that it was very likely the two airlines would complete a deal.
Mr Fenghua offered no specific schedule for an equity deal, commenting instead that the talks would be secondary to the more pressing issues in China currently.
The recent earthquake in southwest China has the Chinese carrier distracted, having already sent 15 planes and six helicopters for rescue work in the Sichuan province.
The SIA proposal follows the rejection by China Eastern minority shareholders in January for the purchase of a 24 percent stake.
China Eastern had rejected the combined offer of Singapore Airlines and its parent, Temasek, after the parent of Air China expressed interest in the carrier.
However, the proposed tie-up with China Eastern was also rejected, as Reuters reports.
The current talks, however, look more promising for the future of Singapore Airlines and China Eastern Airlines.
Singapore Airlines, the second largest airline in the world, has been actively seeking an entry point into the lucrative Chinese market.