If you are in any
doubtas to any aspect of this circular, you should consult a
stockbroker or other registered dealer in securities, bank manager,
solicitor, professional accountant or other professional
adviser.
If you have sold or
transferredall your shares of Air China Limited, you should
at once hand this circular and the form of proxy to the purchaser
or transferee or to the bank, stockbroker or other agent through
whom the sale was effected for transmission to the purchaser or the
transferee.
Hong Kong Exchanges and Clearing Limited and The
Stock Exchange of Hong Kong Limited take no responsibility for the
contents of this circular, make no representation as to its
accuracy or completeness and expressly disclaim any liability
whatsoever for any loss howsoever arising from or in reliance upon
the whole or any part of the contents of this circular.
中國國際航空股份有限公司
AIR CHINA
LIMITED
(a joint stock limited
company incorporated in the People's Republic of China with limited
liability)
(Stock
Code: 00753)
MAJOR TRANSACTION IN RELATION TO THE PURCHASE OF
DOMESTIC AIRCRAFT
A letter from the Board is set out on pages 3 to 8 of
this circular.
A notice convening the EGM will be dispatched by the
Company in due course. The Company will announce details of the
EGM, including the date and venue as and when available in
compliance with the articles of association of the Company and the
Listing Rules.
20 June 2024
|
|
Page
|
|
DEFINITIONS.......................................................................................................................................................
|
1
|
|
LETTER FROM THE BOARD.........................................................................................................................
|
3
|
|
I.
Introduction.................................................................................................................................................
|
3
|
|
II. Major Transaction
...................................................................................................................................
|
4
|
|
III. Financial and Trading
Prospects
..........................................................................................................
|
6
|
|
IV. Working Capital
..........................................................................................................................................
|
7
|
|
V.
EGM..............................................................................................................................................................
|
7
|
|
VI. Recommendation
.....................................................................................................................................
|
7
|
|
VII. Additional Information
.............................................................................................................................
|
8
|
|
APPENDIX I - FINANCIAL INFORMATION OF THE GROUP
........................................................
|
9
|
|
APPENDIX II - GENERAL INFORMATION ............................................................................................
|
12
|
In
this circular, unless the context otherwise requires, the following
expressions have the following meanings:
|
"A Share(s)"
|
ordinary share(s) in the share
capital of the Company, with a nominal value of RMB1.00 each, which
are subscribed for and traded in Renminbi and listed on the
Shanghai Stock Exchange
|
|
"associate(s)"
|
has the meaning ascribed thereto
under the Listing Rules
|
|
"Board"
|
the board of Directors
|
|
"Cathay Pacific"
|
Cathay Pacific Airways Limited
|
|
"CNACG"
|
China National Aviation Corporation
(Group) Limited, a company incorporated under the laws of Hong Kong
and a wholly-owned subsidiary of CNAHC and a substantial
shareholder of the
Company, which
directly holds
approximately 11.75% of the Company's issued share capital as at
the Latest Practicable Date
|
|
"CNAHC"
|
China National Aviation Holding
Corporation Limited, a PRC state-owned enterprise and the
controlling shareholder of the Company, directly and through its
wholly-owned subsidiary CNACG, holding approximately 51.32% of the
issued share capital of the Company in aggregate as at the Latest
Practicable Date
|
|
"COMAC"
|
The Commercial Aircraft Corporation
of China, Ltd., a company incorporated in the PRC with limited
liability
|
|
"COMAC Aircraft"
|
100 C919 aircraft (Extended-range
Version) to be purchased by the Company pursuant to the COMAC
Aircraft Purchase Agreement
|
|
"COMAC Aircraft Purchase" or "Transaction"
|
the purchase by the Company of the
COMAC Aircraft pursuant to the COMAC Aircraft Purchase
Agreement
|
|
"COMAC Aircraft Purchase Agreement"
|
the aircraft purchase agreement
dated 26 April 2024 entered into between the Company and COMAC,
pursuant to which the Company has agreed to purchase the COMAC
Aircraft from COMAC
|
|
"Company" or "Air China"
|
Air China Limited, a company
incorporated in the PRC, whose H Shares are listed on the Stock
Exchange as its primary listing venue and on the Official List of
the UK Listing Authority as its secondary listing venue, and whose
A Shares are listed on the Shanghai Stock Exchange
|
|
"connected person(s)"
|
has the meaning ascribed thereto
under the Listing Rules
|
|
"Director(s)"
|
the director(s) of the Company
|
|
"EGM"
|
the extraordinary general meeting of
the Company to be convened for the Shareholders to consider and, if
thought fit, approve, among other things, the
Transaction
|
|
"Group"
|
the Company and its subsidiaries
|
|
"HK$"
|
Hong Kong dollar, the lawful
currency of Hong Kong
|
|
"Hong Kong"
|
Hong Kong Special Administrative
Region of the PRC
|
|
"H Share(s)"
|
ordinary share(s) in the share
capital of the Company, with a nominal value of RMB1.00 each, which
are listed on the Stock Exchange as primary listing venue and have
been admitted into the Official List of the UK Listing Authority as
secondary listing venue
|
|
"Latest Practicable Date"
|
17 June 2024, being the latest
practicable date prior to the printing of this circular for
ascertaining certain information contained herein
|
|
"Listing Rules"
|
The Rules Governing the Listing of
Securities on the Stock Exchange
|
|
"RMB"
|
Renminbi, the lawful currency of the
PRC
|
|
"SASAC"
|
The
State-owned Assets Supervision and
Administration Commission
|
|
"Shareholder(s)"
|
holder(s) of the shares of the
Company
|
|
"SFO"
|
the Securities and Futures Ordinance
(Chapter 571 of the Laws of Hong Kong)
|
|
"Stock Exchange"
|
The Stock Exchange of Hong Kong
Limited
|
|
"substantial shareholder(s)"
|
has the meaning ascribed thereto
under the Listing Rules
|
|
"Supervisor(s)"
|
the supervisor(s) of the
Company
|
|
"US$"
|
United States dollars, the lawful
currency of the United States
|
|
"%"
|
per cent
|
中國國際航空股份有限公司
AIR CHINA
LIMITED
(a joint stock limited
company incorporated in the People's Republic of China with limited
liability)
(Stock
Code: 00753)
|
Directors:
Executive Directors:
Mr. Ma Chongxian (Chairman)
Mr. Wang Mingyuan
Non-executive Directors:
Mr. Feng Gang Mr. Patrick
Healy
Employee Representative Director:
Mr. Xiao Peng
Independent Non-executive Directors: Mr. Li Fushen
Mr. He Yun Mr. Xu Junxin
Ms. Winnie Tam Wan-chi
|
Registered Address:
1st Floor-9th Floor 101, Building
1
30 Tianzhu Road Shunyi District
Beijing, the PRC
Principal Place of Business in Hong Kong:
5th Floor, CNAC House 12 Tung Fai
Road
Hong Kong International Airport Hong
Kong
|
|
|
20 June 2024
|
To
the Shareholders
Dear Sir or Madam,
MAJOR TRANSACTION IN RELATION TO THE PURCHASE OF
DOMESTIC AIRCRAFT
I.
INTRODUCTION
Reference is made to the announcement of the Company
dated 26 April 2024 in relation to, among other things, the COMAC
Aircraft Purchase.
The purpose of this circular is to provide you with
further information on the COMAC Aircraft Purchase and all the
information reasonably necessary to enable you to make an informed
decision on voting in respect of the relevant resolution at the
EGM.
A notice convening the EGM will be dispatched by the
Company in due course. The Company will announce details of the
EGM, including the date and venue as and when available in
compliance with the articles of association of the Company and the
Listing Rules.
II. MAJOR
TRANSACTION
1.
Background
On 26 April 2024, the Company entered into the COMAC
Aircraft Purchase Agreement with COMAC, pursuant to which the
Company has agreed to purchase the COMAC Aircraft from COMAC.
The details of the Transaction are summarized as
follows.
2.
The COMAC Aircraft Purchase Agreement
Date:
26 April 2024
Parties:
(a)
the Company, as the purchaser, the principal
business activities of which are air passenger, air cargo and
airline-related services; and
(b)
COMAC, as the vendor, one of the principal
business activities of which is civil aircraft manufacturing.
As at the Latest Practicable Date, COMAC is owned as
to 49.80% by the SASAC of the State Council, 20.92% by Shanghai Guosheng
(Group) Co.,
Ltd. (上海國盛（集團）有限公司), which
is
directly wholly-owned by Shanghai SASAC, and the
remaining 29.28% of the shareholdings are owned by multiple
shareholders, each holding less than 10% in COMAC. To the best of
the knowledge, information and belief of the Directors after having
made all reasonable enquiries, COMAC and its ultimate beneficial
owner(s) are third parties independent of the Company and its
connected persons (as defined under the Listing Rules).
Aircraft to be acquired:
100 C919 aircraft (Extended-range Version)
Consideration:
The aircraft basic price comprises the airframe
price, add-on features price and engine price.
According to the latest price catalogue provided by
COMAC, the basic price of the COMAC Aircraft to be acquired by the
Company, in aggregate, is approximately US$10,800 million
(equivalent to approximately HK$84,240 million at an exchange rate
of US$1 = HK$7.80).
COMAC has granted to the Company considerable price
concessions with regard to the COMAC Aircraft. Such price
concessions were determined after arm's length negotiations between
the parties and as a result, the actual consideration for the COMAC
Aircraft Purchase is lower than the aircraft basic price mentioned
above.
The COMAC Aircraft Purchase Agreement was negotiated
and entered into in accordance with customary business practice.
The Directors confirm that the extent of the price concessions
granted to the Company in the COMAC Aircraft Purchase is fair and
reasonable and comparable with the price concessions provided under
the previous similar transactions. The Company believes that there
is no material impact of the price concessions obtained in the
COMAC Aircraft Purchase on the unit operating cost of the Group's
fleet. It is normal business practice of the global airline
industry to disclose the aircraft basic price, instead of the
actual price, for aircraft acquisitions. Disclosure of the actual
consideration will result in the loss of the considerable price
concessions and hence a significant negative impact on the Group's
cost for the COMAC Aircraft Purchase and will therefore not be in
the interests of the Company and the Shareholders as a whole.
Accordingly, the Company has applied to the Stock
Exchange and the Stock Exchange has granted such waiver from strict
compliance with Rules 14.58(4) and 14.66(4) of the Listing Rules in
respect of disclosure of the actual consideration of the COMAC
Aircraft Purchase.
Payment and delivery terms:
The aggregate consideration for the COMAC Aircraft
Purchase is payable by cash in instalments. The Company is
expecting to take delivery of the COMAC Aircraft in stages from
2024 to 2031.
Source of funding:
The COMAC Aircraft Purchase will be funded by
self-owned cash, commercial bank loans and other financing methods.
The COMAC Aircraft Purchase is expected to have no material impact
on the cash flow and business operation of the Company.
The COMAC Aircraft Purchase is subject to the
approval of the Shareholders. Such condition is not waivable.
As at the Latest Practicable Date, the abovementioned
condition is yet fulfilled. The Company will convene the EGM for
Shareholders to consider and approve the COMAC Aircraft
Purchase.
3.
Reasons for and Benefits of the COMAC Aircraft Purchase
The Transaction is in line with the development plan
of the Company and the market demand, which is conducive to the
Group's optimization of fleet structure and long-term supplement of
fleet capacity. The Transaction will expand the fleet capacity of
the Group, the Transaction is expected to increase the fleet
capacity of the Group by approximately 7.5%, based on the number of
available tonne kilometers of the Group as at 31 December 2023
without taking into account the potential adjustments to the fleet
such as aircraft withdrawal due to market condition and aircraft
aging. The new aircraft will be delivered in stages from 2024 to
2031, with some aimed at meeting the renewal needs due to the
withdrawal of aging aircraft from the fleet. The actual net
increase in fleet capacity will be maintained within a manageable
range.
4.
Listing Rules Implications
As the highest applicable percentage ratio under Rule
14.07 of the Listing Rules for the COMAC Aircraft Purchase is above
25% but less than 100%, the COMAC Aircraft Purchase contemplated
under the COMAC Aircraft Purchase Agreement constitutes a major
transaction of the Company and is subject to the reporting,
announcement and Shareholders' approval requirements under Chapter
14 of the Listing Rules.
The Directors believe that the COMAC Aircraft
Purchase is conducted in the ordinary and usual course of business
of the Group on normal commercial terms and the terms of the COMAC
Aircraft Purchase Agreement are fair and reasonable and in the
interests of the Company and the Shareholders as a whole.
None of the Directors had material interests in the
Transaction and thus no Directors were required to abstain from
voting on the board resolution(s) to approve the COMAC Aircraft
Purchase Agreement and the COMAC Aircraft Purchase at the Board
meeting.
III. FINANCIAL AND TRADING
PROSPECTS
There is no change in the fundamentals of the Chinese
economy with the basic trend of economic stability and long-term
improvement still intact. China continues to be in a period of
strategic opportunities. Leveraging the super large-scale domestic
demand market formed by a population of 1.4 billion, including a
middle income group of over 400 million people, China is striving
to build a new development paradigm centred around domestic
circulation, with the international and domestic circulations
mutually reinforcing each other. The demand for civil aviation in
China will continue to maintain a positive growth momentum.
It is expected that the competitive pressures in the
domestic aviation market will alleviate. On the demand side, with
the continued rebound and improvement of the national economy, the
foundation for industrial recovery and development will become more
solid. This will lead to steady growth in the domestic passenger
transportation market, and the international passenger
transportation market will sooner recover, effectively alleviating
the situation of oversupply in the domestic aviation market. In
terms of policy, the Civil Aviation Administration of China has
been advancing a series of reform measures to strengthen
the
foundation for the industry building and development,
enhance the international competitiveness of aviation hubs, leading
to diversified operations among various types of airlines in the
market and reducing disorderly market competition.
In the "14th Five-Year Plan" period, Air China will
adhere to the development goal of "accelerating the construction of
a world-class aviation transportation group with global
competitiveness", adhere to the four strategic directions of "hub
network, passenger and cargo balance, cost leadership, brand
strategy", focus on key areas such as safety management
improvement, market layout optimization, resource structure
adjustment, product service upgrade, digital innovation
development, green and low-carbon development, and promote work
implementation.
The Company has established its operational focuses
for 2024, which included (1) to unwaveringly uphold the principle
of safety first and firmly secure the bottom line of safety; (2) to
vigorously enhance efficiency and quality, and significantly
boosting the level of profitability; (3) to intensify efforts in
reform and innovation, and accelerating the development into a
world-class enterprise; (4) to focus on creating "four excellence"
and promoting comprehensive improvement in service quality; (5) to
strengthen the leading and supporting roles, further enhancing the
Party's leadership and Party building.
In addition, the Directors are of the view that the
Transaction is not expected to have any material impact on
earnings, assets and liabilities of the Group.
IV. WORKING CAPITAL
Taking into account the financial resources available
to the Group and the effect of the Transaction, the Directors are
of the opinion that the Group will have sufficient working capital
for the Group's present requirements for the next 12 months
following the date of this circular.
V. EGM
The Company will convene the EGM to consider and, if
thought fit, to pass the resolution in respect of the COMAC
Aircraft Purchase Agreement and the COMAC Aircraft Purchase.
To the best knowledge, information and belief of the
Directors, having made all reasonable enquiries, no Shareholder or
any of their respective associates have a material interest in the
COMAC Aircraft Purchase. As such, no Shareholders is required to
abstain from voting at the EGM in respect of the resolution to
approve the COMAC Aircraft Purchase Agreement and the COMAC
Aircraft Purchase.
A notice convening the EGM will be dispatched by the
Company in due course. The Company will announce details of the
EGM, including the date and venue as and when available in
compliance with the articles of association of the Company and the
Listing Rules.
VI. RECOMMENDATION
The Board recommends the Shareholders to vote in
favour of the resolution regarding the COMAC Aircraft Purchase
Agreement and the COMAC Aircraft Purchase contemplated
thereunder.
VII. ADDITIONAL INFORMATION
Your attention is also drawn to the additional
information set out in appendices to this circular.
By order
of the Board
Air China
Limited
Ma
Chongxian
Chairman
Beijing, the PRC
1.
CONSOLIDATED FINANCIAL STATEMENTS
The Company is required to set out in this circular
information for the last three financial years with respect to the
profits and losses, financial record and position and the latest
published balance sheet together with the notes to the consolidated
financial statements of the Group for the last financial year.
The audited consolidated financial statements of the
Group for the years ended 31 December 2021, 2022 and 2023, together
with the accompanying notes to the financial statements, can be
found on pages 84 to 188 of the annual report of the Company for
the year ended 31 December 2021, pages 85 to 188 of the annual
report of the Company for the year ended 31 December 2022 and pages
92 to 200 of the annual report of the Company for the year ended 31
December 2023, respectively. Please see below the hyperlinks to the
said annual reports:
https://www1.hkexnews.hk/listedco/listconews/sehk/2022/0425/2022042502186.pdf
https://www1.hkexnews.hk/listedco/listconews/sehk/2023/0424/2023042401849.pdf
https://www1.hkexnews.hk/listedco/listconews/sehk/2024/0425/2024042502352.pdf
2.
INDEBTEDNESS
As at 30 April 2024, being the latest practicable
date for the purpose of determining the indebtedness of the Group
prior to the printing of this circular, except for the authorised
or created but unissued debt securities and contingent liabilities,
the Group had total outstanding indebtedness of RMB236,943 million,
details of which are as follows:
|
|
Note
|
RMB
|
|
|
|
(in million)
|
|
|
|
|
|
Bank loans
|
|
|
|
|
|
|
|
- unsecured and unguaranteed
|
|
125,482
|
|
- secured and unguaranteed
|
(i)
|
708
|
|
|
|
|
|
|
|
|
|
|
|
126,190
|
|
Loans from the ultimate holding company
|
|
|
|
|
|
|
|
- unsecured and unguaranteed
|
|
16,829
|
|
|
|
|
|
Loans from a fellow subsidiary
|
|
|
|
|
|
|
|
- unsecured and unguaranteed
|
|
301
|
|
|
|
|
|
|
|
|
|
Corporate bonds
|
|
|
|
|
|
|
|
- unsecured and unguaranteed
|
|
11,313
|
|
|
|
|
|
|
|
|
|
Short-term commercial papers payable
|
|
|
|
|
|
|
|
- unsecured and unguaranteed
|
|
2,004
|
|
|
|
|
|
|
Note
|
RMB
|
|
|
|
(in million)
|
|
|
|
Lease liabilities
|
|
|
|
|
- leases of aircraft containing a
purchase option
|
|
|
|
- unsecured and unguaranteed
|
|
46,186
|
|
|
|
|
- leases of aircraft not containing
a purchase option
|
|
|
|
- secured and unguaranteed
|
(ii)
|
17,156
|
|
- unsecured and guaranteed
|
(iii)
|
15,107
|
|
- unsecured and unguaranteed
|
|
816
|
|
|
|
|
|
|
33,079
|
|
|
|
|
- leases of buildings and
others
|
|
|
|
- unsecured and unguaranteed
|
|
1,041
|
|
|
|
|
|
|
34,120
|
|
|
|
|
Total
|
|
236,943
|
|
|
|
| |
Notes:
(i)
The Group's bank loans with an aggregate amount of
approximately RMB708 million as at 30 April 2024 were secured by
charges over certain of the Group's assets, including aircraft,
engines and flight equipment, buildings and land use rights, and
other intangible assets.
(ii)
The Group's secured and unguaranteed lease
liabilities with an aggregate amount of approximately RMB17,156
million as at 30 April 2024 were related to leases of aircraft not
containing a purchase option and secured by rental
deposits.
(iii) The Group's unsecured and guaranteed lease liabilities with an
aggregate amount of approximately RMB15,107 million as at 30 April
2024 were related to leases of aircraft not containing a purchase
option and guaranteed by letters of guarantee.
As at 30 April 2024, the Group had a total amount of
authorised or created but unissued debt securities of RMB19,000
million, which was unsecured and unguaranteed, including RMB18,000
million with a validity period ended 9 June 2024, and RMB1,000
million with a validity period ended 21 December 2024.
Contingent liabilities
As at 30 April 2024, the
Group had the following significant contingent liabilities:
Pursuant to the restructuring of China National
Aviation Holding Corporation Limited (the "CNAHC") in preparation for the listing
of the Company's H shares on The Stock Exchange of Hong Kong
Limited and the London Stock Exchange, the Company entered into a
restructuring agreement (the "Restructuring Agreement") with CNAHC
and China National Aviation Corporation (Group) Limited
("CNACG", a wholly-owned
subsidiary of CNAHC) on 20 November 2004. According to the
Restructuring Agreement, except for liabilities constituting or
arising out of or relating to business undertaken by the Company
after the restructuring, no liabilities would be assumed by the
Company and the Company would not be liable, whether severally, or
jointly and severally, for debts and obligations incurred prior to
the restructuring by CNAHC and CNACG. The Company has also
undertaken to indemnify CNAHC and CNACG against any damage suffered
or incurred by CNAHC and CNACG as a result of any breach by the
Company of any provision of the Restructuring Agreement.
Except as disclosed above and apart from intra-group
liabilities and normal trade payables, as at 30 April 2024, the
Group did not have any debt securities issued and outstanding, or
authorised or otherwise created but unissued, term loans,
debentures, any other borrowings or indebtedness in the nature of
borrowing of the Group including bank overdrafts and liabilities
under acceptances (other than normal trade bills) or acceptance
credits, recognised lease obligations or hire purchase commitments,
mortgages, charges, material contingent liabilities or
guarantees.
1.
RESPONSIBILITY STATEMENT
This circular, for which the Directors collectively
and individually accept full responsibility, includes particulars
given in compliance with the Listing Rules for the purpose of
giving information with regard to the Group. The Directors, having
made all reasonable enquiries, confirm that to the best of their
knowledge and belief, the information contained in this circular is
accurate and complete in all material respects and not misleading
or deceptive, and there are no other matters the omission of which
would make any statement herein or this circular misleading.
2. DISCLOSURE
OF INTERESTS OF DIRECTORS AND SUPERVISORS
As at the Latest Practicable Date, none of the
Directors, Supervisors or chief executive of the Company had
interests or short positions in the shares, underlying shares
and/or debentures (as the case may be) of the Company or its
associated corporations (within the meaning of Part XV of the SFO)
which were notifiable to the Company and the Stock Exchange
pursuant to the SFO, or were recorded in the register maintained by
the Company pursuant to section 352 of the SFO, or which were
notifiable to the Company and the Stock Exchange pursuant to the
Model Code for Securities Transactions by Directors of Listed
Issuers.
As at the Latest Practicable Date, none of the
Directors or Supervisors of the Company had any direct or indirect
interest in any assets which have been, since 31 December 2023
(being the date to which the latest published audited financial
statements of the Group were made up), acquired or disposed of by
or leased to any member of the Group or are proposed to be acquired
or disposed of by or leased to any member of the Group.
As at the Latest Practicable Date, none of the
Directors or Supervisors of the Company was materially interested
in any contract or arrangement which is significant in relation to
the business of the Group and subsisting as at the Latest
Practicable Date.
Mr. Patrick Healy, a non-executive Director, is
concurrently the chairman and an executive director of Cathay
Pacific. Cathay Pacific is a substantial shareholder of the
Company, holding 2,633,725,455 H Shares of the Company
(representing approximately 15.87% of the total issued shares of
the Company) as at the Latest Practicable Date. Mr. Ma Chongxian
and Mr. Wang Mingyuan, both are executive Directors, are
concurrently non-executive directors of Cathay Pacific. Cathay
Pacific competes or is likely to compete either directly or
indirectly with some aspects of the business of the Company as it
operates airline services to certain destinations, which are also
served by the Company.
Save as disclosed above, as at the Latest Practicable
Date, none of the Directors or Supervisors of the Company and their
respective close associates (as defined in the Listing Rules) had
any competing interests which would be required to be disclosed
under Rule 8.10 of the Listing Rules.
3.
DISCLOSURE OF INTERESTS OF SUBSTANTIAL SHAREHOLDERS
As at the Latest Practicable Date, so far as the
Directors were aware, the following persons (not being a Director
or Supervisor or chief executive of the Company or their associate)
had an interest or short position (if any) in the Shares or the
underlying Shares which would fall to be disclosed to the Company
under Divisions 2 and 3 of Part XV of the SFO, or which were
recorded in the register of the Company required to be kept under
section 336 of the SFO:
|
Name
|
Type of interests
|
Type
and
number of
shares
held
|
Approximate
percentage of the
total number of Shares in issue
|
Percentage
of
the
total issued A Shares of the Company
|
Percentage
of the total
issued H Shares of the Company
|
|
|
|
CNAHC
|
Beneficial owner
|
6,566,761,847 (L)
A
Shares
|
39.57%
|
56.42%
|
-
|
|
CNAHC(1)
|
Equity attributable
|
1,332,482,920 (L)
A
Shares
|
8.03%
|
11.45%
|
-
|
|
CNAHC(1)
|
Equity attributable
|
616,779,308 (L)
H
Shares
|
3.72%
|
-
|
12.45%
|
|
CNACG
|
Beneficial owner
|
1,332,482,920 (L)
A
Shares
|
8.03%
|
11.45%
|
-
|
|
CNACG
|
Beneficial owner
|
616,779,308 (L)
H
Shares
|
3.72%
|
-
|
12.45%
|
|
Cathay Pacific
|
Beneficial owner
|
2,633,725,455 (L)
H
Shares
|
15.87%
|
-
|
53.15%
|
|
Swire Pacific Limited(2)
|
Equity attributable
|
2,633,725,455 (L)
H
Shares
|
15.87%
|
-
|
53.15%
|
|
John Swire
& Sons (H.K.) Limited(2)
|
Equity attributable
|
2,633,725,455 (L)
H
Shares
|
15.87%
|
-
|
53.15%
|
|
John Swire & Sons Limited(2)
|
Equity attributable
|
2,633,725,455 (L)
H
Shares
|
15.87%
|
-
|
53.15%
|
Notes:
(1)
By virtue of CNAHC's 100% interest in CNACG, CNAHC
was deemed to be interested in the 1,332,482,920 A Shares and
616,779,308 H Shares directly held by CNACG.
(2)
By virtue of John Swire & Sons Limited's 100%
interest in John Swire & Sons (H.K.) Limited and their
approximately 60.31% equity interest and 68.13% voting rights in
Swire Pacific Limited, and Swire Pacific Limited's approximately
45.00% interest in Cathay Pacific as at the Latest Practicable
Date, John Swire & Sons Limited, John Swire & Sons (H.K.)
Limited and Swire Pacific Limited were deemed to be interested in
the 2,633,725,455 H Shares of the Company directly held by Cathay
Pacific.
(3)
The letter "L" denotes a long position in the
Shares.
Save as disclosed above, as at the Latest Practicable
Date, no other persons (not being a Director or Supervisor or chief
executive of the Company or their associate) had any interest or
short position (if any) in the Shares or the underlying Shares
which would fall to be disclosed to the Company under Divisions 2
and 3 of Part XV of the SFO, or which were recorded in the register
of the Company required to be kept under section 336 of the
SFO.
4. SERVICE
CONTRACTS OF DIRECTORS AND SUPERVISORS
As at the Latest Practicable Date, none of the
Directors or Supervisors had any existing or proposed service
contract with any member of the Group which is not expiring or
terminable by the Group within one year without payment of
compensation (other than statutory compensation).
5.
DIRECTORS' AND
SUPERVISORS' EMPLOYMENT WITH SUBSTANTIAL SHAREHOLDERS
The followings are the particulars of Directors' and
Supervisors' employment with substantial Shareholders (holding
interests or short positions in the shares and underlying shares of
the Company required to be disclosed to the Company pursuant to
Divisions 2 and 3 of Part XV of the SFO) as at the Latest
Practicable Date:
Directors
Mr. Ma Chongxian, an executive Director, the chairman
of the Board and the secretary of the Party Committee of the
Company, serves as a director, the chairman and the secretary of
the Party Leadership Group of CNAHC. He is also a non-executive
director of Cathay Pacific.
Mr. Wang Mingyuan, an executive Director, the vice
chairman of the Board, the president and the deputy secretary of
the Party Committee of the Company, serves as a director, the
general manager and the deputy secretary of the Party Leadership
Group of CNAHC. He is also a non- executive director of Cathay
Pacific.
Mr. Feng Gang, a non-executive Director and the
deputy secretary of the Party Committee of the Company, serves as a
director and the deputy secretary of the Party Leadership Group of
CNAHC.
Mr. Patrick Healy, a non-executive Director of the
Company, is the chairman of the board of directors and an executive
director of Cathay Pacific, a director of Swire Pacific Limited,
and a director of John Swire & Sons (H.K.) Limited.
Mr. Xiao Peng, the employee representative Director
of the Company, serves as the chairman of the labour union and the
employee representative director of CNAHC.
Supervisor
Ms. Lyu Yanfang, a Supervisor of the Company, serves
as the general manager of the law department of CNAHC.
6.
NO MATERIAL ADVERSE CHANGE
As at the Latest Practicable Date, there has been no
material adverse change in the Group's financial or trading
position since 31 December 2023, being the date to which the latest
published audited financial statements of the Group have been made
up.
7. LITIGATION
As at the Latest Practical Date, the Company was not
involved in any significant litigation or arbitration and to the
knowledge of the Company, there were no litigation or claims of
material importance pending or threatened against any member of the
Group.
8.
MATERIAL CONTRACTS
The Group has entered into the following material
contracts within the two years immediately preceding the date of
this circular.
(a) the COMAC Aircraft Purchase Agreement;
(b) the conditional subscription agreement dated 30 January 2024
entered into between the Company and CNACG in respect of the
issuance of H Shares to specific investor, pursuant to which, the
Company has agreed to issue, and CNACG has agreed to subscribe for
new H Shares in the amount of not more than HK$2.00 billion at
HK$5.09 per share;
(c)
the conditional subscription agreement dated 22
December 2023 entered into between the Company and CNAHC in respect
of the issuance of A Shares to specific investor, pursuant to
which, the Company has agreed to issue, and CNAHC has agreed to
subscribe for new A Shares in the amount of not more than RMB6.00
billion at RMB7.02 per share;
(d) the conditional subscription agreement dated 2 August 2022 in
respect of the 2022 non-public issuance of A Shares entered into
between the Company and CNAHC, pursuant to which, the Company has
agreed to issue, and CNAHC has agreed to subscribe for A Shares in
the amount of not less than RMB5.5 billion;
(e)
the agreement dated 1 July 2022 entered into
between Shenzhen Airlines Company Limited ("Shenzhen Airlines") and Airbus S.A.S.
("Airbus Company"),
pursuant to which Shenzhen Airlines has agreed to purchase and
Airbus Company has agreed to sell 32 Airbus A320NEO series
aircraft. The basic price of the 32 Airbus aircraft, in aggregate,
is approximately US$3.923 billion (price quoted as at January
2020); and
(f)
the agreement dated 1 July 2022 entered into among
the Company, Air China Import and Export
Co., Ltd. (國航進出口有限公司) and Airbus Company, pursuant to which the
Company has agreed to purchase and Airbus Company has
agreed to sell 64 Airbus A320NEO series aircraft. The basic price
of the 64 Airbus aircraft, in aggregate, is approximately US$8.290
billion (price quoted as at January 2020).
9.
MISCELLANEOUS
a.
The joint company secretaries of the Company are
Mr. Xiao Feng and Mr. Huen Ho Yin. Mr. Huen Ho Yin is a practicing
solicitor of the High Court of Hong Kong.
b.
The registered address of the Company is at 1st
Floor - 9th Floor 101, Building 1, 30 Tianzhu Road, Airport
Industrial Zone, Shunyi District, Beijing, the PRC. The head office
of the Company is at No. 30 Tianzhu Road, Airport Industrial Zone,
Shunyi District, Beijing, the PRC.
c.
The H Share registrar and transfer office of the
Company is Computershare Hong Kong Investor Services Limited, the
address of which is Shops 1712-1716, 17/F, Hopewell Centre, 183
Queen's Road East, Wanchai, Hong Kong.
10. DOCUMENTS ON
DISPLAY
Copies of the following documents will be published
on the websites of the Stock Exchange (www.hkexnews.hk) and the
Company (www.airchina.com.cn) for a period of 14 days from the date
of this circular:
a.
the COMAC Aircraft Purchase Agreement;
and
b.
this circular.
In respect of the Transaction, the Company has
applied for, and the Stock Exchange has granted, a waiver from
strict compliance with Rule 14.66(10) and paragraph 43(2)(c) of
Appendix D1B to the Listing Rules so that information in relation
to the Consideration, price calculation mechanism, payment
arrangement, specific information in relation to aircraft models,
the aircraft delivery plan, exchange rate and notice, all of which
are core trade secrets for contracting parties and have comparable
commercial sensitivity, will be redacted pursuant to a request for
confidential treatment by COMAC. The above redacted information is
commercial sensitive information strictly personal and exclusive to
each party to the COMAC Aircraft Purchase Agreement and generally
recognized as customized and confidential information in the
aviation industry, the disclosure of which will be competitively
harmful to the Company. In addition, information in relation to the
bank accounts and contact information will also be redacted. Such
information are solely for the purpose of the performance of the
COMAC Aircraft Purchase Agreement and are not material to the
decision of the Shareholders in respect of the COMAC Aircraft
Purchase, the disclosure of which may create unnecessary contact
between the public and contracting parties. The material terms
stipulated under the COMAC Aircraft Purchase Agreement have been
summarised and disclosed in this circular, from which the
Shareholders and the investing public will be able to have
sufficient information and knowledge about the COMAC Aircraft
Purchase and assess the impact of the COMAC Aircraft Purchase so
that the Shareholders and the investing public would make an
informed voting decision on the Transaction. In addition, the
Shareholders and the investing public are provided with sufficient
information regarding the reasons for and benefits of the COMAC
Aircraft Purchase. Therefore, the redacted version of the COMAC
Aircraft Purchase Agreement is unlikely to mislead the Shareholders
regarding to the facts and circumstances, knowledge of which is essential
for the informed assessment of the Transaction. Accordingly, only
the redacted version of the COMAC Aircraft Purchase Agreement will
be available for display to the public.