Chinese Online Class - Aviation: Juneyao to sell $150m stake to foreign allies

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BIZCHINA / Biz Media Digest

Aviation: Juneyao to sell $150m stake to foreign allies

(South China Morning Post)
Updated: 2007-08-13 14:57

Juneyao Airlines, a privately owned mainland airline, plans to raise
US$150 million by offering 20 per cent to 25 per cent of its aviation
business to overseas strategic investors.

"We hope to tie up with foreign investors who can bring in management
expertise as well as help us expand our fleet and upgrade technologies,"
chief executive Bryan Huang Hui told the South China Morning Post.
"Juneyao is aiming to set up a sound management system to benefit from
China's sizzling economy."

Last month, Juneyao hired Citigroup as its financial adviser for the
share sale.

A deal was expected to be in place before the year-end, making Juneyao
the first mainland private airline to bring in overseas capital and
funds, Mr Huang said. The share sale will be a prelude to a likely
initial public offering on an overseas stock market late next year or
early in 2009.

The share sale had attracted keen attention from the financial and
business community, with interest already shown by some private equity
funds and hedge funds, Mr Huang said.

The former China president of BearingPoint, a global technology and
management consultancy, said Juneyao would take a global perspective as
it seeks to be distinct from domestic rivals.

"We are eyeing a model that fits China," he said. "Juneyao Airlines will
focus on offering premium services to cater for mainland passengers,
particularly the business travellers."

Juneyao Airlines made its maiden flight in September last year and now
has four planes, compared with low-cost carrier Okay with six. The group
aims to expand its fleet to 67 planes by 2010 - with Juneyao Airlines
flying 30 aircraft and Okay the remaining 37, including 20 for passenger
flights and 17 for cargo.

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