Cathay Pacific to Buy Budget Airline HK Express
by Traveleads | March 7, 2019 | In The Air Latest News
Cathay Pacific Airways Ltd is in talks to buy shares in Hong Kong’s only budget airline from Chinese conglomerate HNA Group Co.
The Hong Kong flag carrier says in a statement that it is “in active discussions about an acquisition involving HKE”.
Cathay adds that “no agreement for the acquisition has been entered into and there can be no certainty that any agreement will be entered into”.
As reported by Bloomberg, the stake purchase would give Cathay a critical foothold in the market for budget-conscious travellers. “This is part of a very big change in Cathay’s strategy,” Steven Leung, executive director of UOB Kay Hian (Hong Kong) Ltd., said by phone. “Competitors are developing budget airlines which have challenged its business. I think this deal will benefit the company in the long run.”
While Cathay acknowledged the media report, it did not comment on whether or not it is also in discussions to acquire a stake in Hong Kong Airlines, saying only that “further announcements will be made as and when appropriate”.
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