Cathay, Swire Pacific, Air China Suspend Trading in Hong Kong

- Advertisement -
- Advertisement -
- Advertisement -
- Advertisement -

Embattled Hong Kong carrier Cathay Pacific Airways Ltd. and its two main shareholders, Swire Pacific Ltd. and Air China Ltd., suspended trading of their shares Tuesday pending an announcement.

The move comes as Cathay contends with a slump in traffic brought on by the coronavirus outbreak and the travel restrictions that ensued. The curbs hit Cathay particularly hard because it has no domestic market to fall back on, whereas carriers in China are rebuilding capacity on flights within the mainland.

Even before the pandemic, Cathay was under enormous financial and political pressures as it found itself caught up in the Hong Kong anti-government protests, which affected traffic numbers and led to the exit of the company’s former chief executive officer. Cathay was criticized by China, protesters and its own workers for its response to the demonstrations.

Air China has owned about 30% of Cathay for more than a decade, while Swire, one of the last remaining British trading companies based in Hong Kong, has a 45% stake. Qatar Airways has a 9.99% holding.

Cathay could be planning to raise funds via a rights issue backed by Swire and Air China, said Justin Tang, head of Asia research at United First Partners. He also said there’s been speculation that Air China may propose a takeover by buying Swire’s stake.

Cathay Pacific’s Crisis Puts Focus on Air China’s Next Move

Cathay and its Cathay Dragon unit posted an unaudited net loss of HK$4.5 billion ($581 million) in the first four months of the year as their route network shrank to just 14 destinations. In April, the two carriers combined flew only 458 passengers a day, on average, and Cathay warned that international travel demand will take a few years to recover. Cathay also owns Hong Kong Express.

The coronavirus has hurt airlines the world over. Singapore Airlines Ltd., which like Cathay doesn’t have a domestic market to speak of, raised S$8.8 billion ($6.3 billion) in a rights issue last week and has followed that by securing new lines of credit and loans to further bolster its finances. Morgan Stanley said the rights issue alone should provide enough liquidity to see the airline through the fiscal year.

This article was originally posted on
Home of Science
Follow me

- Advertisement -




Retiring in 10-20 years? Here’s your best approach to stocks right now, says top U.S. financial adviser.

For Thursday, we’ve got earnings news ahead from Apple, Amazon and Gilead, the latter of which has been fueling optimism with its own COVID-19 treatment. After that...

What Does It Mean To Be “A New Billie Eilish”?

What does it mean to be "a new Billie Eilish?" I don't know if it's a good or bad thing, but it is definitely...

How to Choose a Mesothelioma Attorney

How to Choose a Mesothelioma AttorneyA mesothelioma attorney may be able to help you get the compensation you need, but this is not...

A Look at Penny Stocks and Their History

Penny stocks are a relatively new type of stock. This means that when you invest in one of these stocks, you will be investing...

What a Business Plan Template Can Do For Your Business

What a Business Plan Template Can Do For Your BusinessA Business Plan Template is basically a document containing all of the essential information...
Home of Science
Follow me