Keep Pushing

The Singapore Airlines acquisition would be a very positive move for China Eastern. If the Chinese government is in favor of it, Air China will back down. I haven't heard what is going on behind the scenes with this potential merger, and it would be interesting to know.

China Eastern Airlines has said it will persevere its attempts to get shareholder backing for the sale of a 24% stake to Singapore Airlines and Temasek for US$923 million, the South China Morning Post reported.

The airline has so far made little headway in bringing support on board. China National Aviation Holding (CNAH), the parent company of Air China, owns 12.07% of China Eastern's H-shares as well as funds that have stakes in the airline, is threatening to oppose the sale, claiming the price is too low. However, China Eastern chairman Li Fenghua said he would "keep asking for a vote until the same proposal is approved at the board meeting."

The meeting is scheduled for January 8. Li made entreaties to CNAH on Wednesday, visiting the group's headquarters for talks and later saying that it had "expressed understanding of and support for the deal."