CNAC announcement

[HIALS]

CNAC shares are currently suspended on the Hong Kong Stock Exchange. This is because of an impending announcement regarding "disclosable and connected transactions".

The red-hot rumour is that CNAC is going to become the major listed vehicle for raising capital for China National Aviation Holdings Ltd (Air China, CNAC & China Southwest Airlines). Rather than listing CNAH the decision is to grow through CNAC.

Implications are bad for Cathay Pacific (who's shares fell substantially today despite an otherwise bouyant share market) and Swire Pacific (who's shares fell substantially today despite an otherwise bouyant share market).

Cathay & Swire are going to sell-down their holdings in Dragonair (read - "connected transactions") to Air China who will pump-up Dragonair as the vehicle for MAJOR expansion out of Hong Kong (read - "disclosable").

It is not exaggerating to say that Dragonair is becoming the new flag carrier.

[Schrodingers Cat]

This is a direct result of CX 'winning' the Beijing frequency battle. The original deal, done so long ago, kept CX out of the Chinese mainland market. This is only the thin end of the wedge, the powers that be have decided to take on CX for once and for all now, and they know how to play dirty.........:ooh:

[fr8ter boi]

It was on the horizon a long time before CX started flying to Beijing and Shanghai. I was speaking to a member of the CX management well over two years ago. He was predicitng this situation - from knowlegde rather than speculation I guess.

[SLT]

For those of us who are less familiar with HK and CX, but are desperately trying to be as up to speed as possible for interview.............. Can anyone give me any more information on this? What are the implications (long and short-term) for CX and KA??? It sounds as though KA stands to benefit and CX stands to lose out markedly from this. Am I correct?? If so, how do you think it will affect CX's future plans??

Thanks very much for any insight.

[HIALS]

Oh well - it was a good rumour while it lasted...

Can't say I'm very excited about the purchase of a 60% share of 2 catering companies.

[TTBoy]

Well it is now May 4th, still no announcement. What the heck was the suspension of shares really about? Stock closed down - again at 1.21. Great time to buy, but a losey company to invest in.