• Taiwan giants sell Yangtze River Express stakes back to Hainan Air
  • 2010-09-14
TAIWAN's China Airlines (CAL), Yang Ming and Wan Hai have recently announced they will divest themselves of stakes in Shanghai-based Yangtze River Express Airlines by the end of 2012, reports Taiwan Economic News.

All three transport giants will sell the stakes back to the Hainan Air, the cargo airline's largest shareholder in China. CAL, Taiwan's largest airline, will sell its 25 per cent stake for CNY312.5 million (US$46 million), while Yang Ming Marine will divest its 12 per cent valued at CNY150 million, and Wan Hai will dispose its six per cent for CNY75 million.

The three companies bought Yangtze River Express stakes in 2005 with CAL becoming the largest foreign shareholder.

"The investment at the time was aimed at being a strategic alliance tapping the huge Chinese market in 2005, when no direct air links had been set up across the Taiwan Strait," said CAL spokesman Hamilton Liu, according to a report in Taiwan's China Post.

"But now things have changed as cross-Taiwan Strait business ties are getting closer than ever with direct flights having been launched. We have decided to divest our investment, looking for new business opportunities," he said.

Mr Liu said that for CAL, its divestment will be carried out in phases over the next two or three years. Yang Ming Marine and Wan Hai said they will hold talks with Hainan Air on further details of their divestments.

Yangtze River Express, established in 2002, owns a fleet of 12 planes, operating domestic cargo flights and serving destinations in the US and Europe.