Cathay Pacific has announced that it intends to terminate the eight-year shareholding agreement between the two airlines by repurchasing all of its shares, valued at HK$6.96 billion (US$896 million), from Doha-based Qatar Airways.
One day following the announcement of the pullout, the airline’s share in Hong Kong increased by more than 4.0 percent to HK$11.7 per share on Thursday.
“The buyback reflects our strong confidence in the future of the Cathay Group and underscores our commitment to the development of the Hong Kong international aviation hub,” Cathay Group Chair Patrick Healy said in a statement on Wednesday.
According to the announcement, Qatar Airways’ stake in Cathay amounts to roughly 9.6% of the Hong Kong carrier’s total issued shares.
According to Badr Mohammed Al-Meer, CEO of Qatar Airways Group, the deal “reflects Qatar Airways Group’s disciplined approach to portfolio management and our commitment to delivering sustainable value for our shareholders.”
In a filing to the Hong Kong stock exchange, Cathay stated that following the buyback, the company’s public float will be lowered to about 20.5 percent of the issued shares.
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