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Cathay Pacific says in talks to buy stake in HK Express Airways
[HONG KONG] Hong Kong flagship carrier Cathay Pacific Airways Ltd said on Tuesday it is in "active discussions" about an acquisition involving Hong Kong Express Airways Ltd, although an agreement has yet to be reached.
The airline said it made the statement in response to media reports suggesting Cathay Pacific may be in talks to acquire shares in Hong Kong Express Airways Ltd and Hong Kong Airlines Ltd from cash-strapped Chinese conglomerate HNA Group Co Ltd.
Cathay Pacific said it would issue an additional statement when appropriate.
Embattled HNA Group is more than a year into the process of unwinding a US$50 billion acquisition spree that at its peak netted the company stakes in banks, fund managers, hotels, property and airlines, among other assets.
Faced with soaring debt and government scrutiny of aggressive deal-making, HNA has pushed ahead with asset sales that have included real estate and stakes in hotel groups, and discussions on key overseas units such as Ingram Micro and its luxury US$300 million-plus corporate "Dream Jet".
News of Cathay's interest in HK Express comes just weeks after Hong Kong's flagship carrier projected its annual profit at more than double analyst estimates, sending its shares surging nearly 9 per cent.
Shares of Cathay Pacific have risen 17 per cent so far this year, compared with an 8 per cent fall in 2018.
In August, HNA announced a management reshuffle to calm worries about leadership at the comglomerate after the sudden death of its co-chairman, Wang Jian, during a business trip.