Home > > China Southern sells 5.01% stake in TravelSky to China Mobile

China Southern sells 5.01% stake in TravelSky to China Mobile

12/17/2018| 5:22:57 PM| ChinaTravelNews 中文

After selling its 5.01% stake in TravelSky to China Mobile, Southern Holding will have its stake in TravelSky reduced to 9.18% and cease to be a substantial shareholder of the company.

On December 14, China Southern Air Holding entered into an equity transfer agreement with China Mobile Capital Holding, a wholly-owned subsidiary of China Mobile Communications Group, and agreed to sell 146,600,000 domestic shares of TravelSky to the latter, at HK$15,58 per share. 

The transaction represents approximately 5.01% of the total issued share capital of TravelSky. The deal is subject to the approval of the State-owned Assets Supervision and Administration Commission of the State Council.

Following the deal, Southern Holding will, directly and indirectly, hold 268,555,000 shares, or 9.18% of TravelSky, and cease to be a substantial shareholder of the company. Southern Holding and its associates will no longer be “connected persons” of TravelSky.

TravelSky said in a statement that Southern Holding and its subsidiaries would continue to maintain strategic cooperation with and support the business development of TravelSky.  Southern Holding does not have further plans to decrease its shareholding in the company.

Southern Holding confirmed that the transaction was for the purposes of its own business development and would not have any impact on the long-term relationship between the two parties. 

There is speculation that the latest sale may have been precipitated by the soured relationship between China Southern and TravelSky’s affiliate Umetrip, when China Southern halted all online check-in services offered by third-parties like Umetrip, VariFlight, Ctrip and Fliggy since April.

At present, China Southern only handles bookings made through its own APP, SMS or WeChat account, as it has completely shut out intermediary platforms.

The latest move of China Southern is seen by industry insiders as another attempt to fortify its direct sales business.

China Mobile said buying into TravelSky fits with its strategy of expanding its core business and supporting its transformation and development. Working on an equity cooperation basis, China Mobile and TravelSky will leverage the synergy and collaborative innovation between the two state-owned enterprises, expand integration of communications and aeronautical information services, and collaborate on big data applications, enterprise informatization and public customer services.

TAGS: China Southern | TravelSky | China Mobile
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