Hong Kong government to take a HK$40 billion stack in Cathay Pacific

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  • cwoodward
    Participant

    Leaked information indicates that the HK government will tomorrow announce that they will assist the airline with a $30 billion loan and take a HK$10 billion equity stake in the airline.
    Indications are that the government will have two observers on the Cathay board
    Trading in Swire and Cathay Pacific shares was halted last evening.

    1 user thanked author for this post.

    stevescoots
    Participant

    which no doubt will end up eventually in the hands of a China state investment company or airline


    cwoodward
    Participant

    stevescoots
    What please would be your reasoning for what may I say is a rather simplistic conclusion considering that Swire has proved itself to be a very able and long term player in the airline industry for the past 70 years. Swire is a buyer of mainland assets rather than a seller.


    canucklad
    Participant

    My mate was telling me that he’s waiting for an announcement from Cathay this week. He didn’t sound hopeful that the news would be good, particularly since he’s been there a while and on a Captains salary . I also wonder if the 777 (his aircraft) might be the new 747 ?

    Hopefully this news might make the expected blow better !


    stevescoots
    Participant

    Bottom line is that it is seen as a colonial hangover still controlled by an old British family by those across the SZ ditch. That does not fit the nationalistic narrative of China excellence


    cwoodward
    Participant

    Thanks stevescoots
    ‘Bottom line is that it is seen as a colonial hangover’ Seen by whom may I ask ?
    Sadly a rhetorical question I would like to debate this with you as I disagree with your conclusions and reasoning but I fear that the debate would likely become just too political for the forum.

    1 user thanked author for this post.

    DavidGrodentz
    Participant

    China already has a stake in Cathay through Air China of just under 30%, Swire have around 45%

    Incidentally, Cathay have a 20% stake in Air China, both happened at the same time

    The HK Government will hold 6% of Cathay after the restructuring, and 2 observer seats on the Board

    Seems like a good model to follow, governments help with airline restructuring, and take a stake that can be sold in better times, whenever that may be

    1 user thanked author for this post.

    TupeloKid
    Participant

    I’m not a big fan of Cathay, or of bailouts (especially of bearded people), but I think this is a good thing for Hong Kong and may well (as David Grodentz says) be a good investment which, as a HK tax payer (though not much, since it IS Hong Kong) I am happy with.

    I just hope that they invest some of the money in more comfortable seats. (There, I got my dig in.)

    1 user thanked author for this post.

    cwoodward
    Participant

    “I just hope that they invest some of the money in more comfortable seats. (There, I got my dig in.)”

    I can’t let you get away with that TupeloKid

    That ‘world renown’ organisation Skytrex rates Cathay seats as 4.5 out of 5 compared to 3 for BA


    Marc_ACB
    Participant

    Perhaps we need a Hong Kong forum meet up, to discuss the views in person one day.


    cwoodward
    Participant

    Just to be clear – my reply re seats was of course not intended to be taken seriously.

    A HK meetup has been on the cards for some time and now would perhaps an opportune time to put something together – Tom ?


    TupeloKid
    Participant

    “I just hope that they invest some of the money in more comfortable seats. (There, I got my dig in.)”

    I can’t let you get away with that TupeloKid

    That ‘world renown’ organisation Skytrex rates Cathay seats as 4.5 out of 5 compared to 3 for BA

    You have the advantage on me there, cwoodward. Curmudgeon that I am, I don’t fly BS because (in the class I sometimes travel – depending on the price at the time) I can’t reserve my seat on BA at the time of booking. Therefore my only points of reference for direct flights to London (though I do sometimes take indirect flights, e.g. with FinnAir, to avoid this whole thorny issue) are Cathay and the Bearded Airline. So I end up on VS.

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