Latest edition of The Economist speculates on a takeover by Air China.
"As for Cathay, Air China holds a 30% stake in the airline. Old rumors of the flag carrier's intention to buy Cathay outright have resurfaced. Luya You of Bocom International, a broker, says an acquisition would transfer Cathay''s global expertise to Air China and "quell China's concerns about its foreign background" (ie Swire). Given all the turbulence, few expect such a high-stakes deal to happen soon. Still, in the meantime, Mr You has a simple message for investors "Do not underestimate China's resolve to punish Cathay as a symbol for others." Many will have heard that disturbing message loud and clear.