"Qatar Airways will sell its stake in Hong Kong-based Cathay Pacific Airways in a share buyback valued at $896 million, the companies announced, ending the Qatari carrier's eight-year involvement with the airline.The announcement came late Wednesday in a stock market filing by Cathay Pacific, which saw its shares gain 4.2% on the Hong Kong Stock Exchange on Thursday.Under the agreement, Qatar Airways will sell all of its holdings, which represent 9.57% of Cathay Pacific stock."
"Qatar Airways, a state-owned airline flying out of the sprawling Hamad International Airport in Doha, did not acknowledge the sale itself. However, the Cathay Pacific statement included a comment from its CEO Badr Mohammed al-Meer saying the move represented the airline's "disciplined approach to portfolio management and our commitment to delivering sustainable value for our shareholders.""
"Qatar Airways' decision to divest likely had to do in part with its "limited strategic influence afforded by (its) minority stake," DBS Bank analysts Tabitha Foo and Jason Sum said in an email.The latest transaction also "further consolidates ownership among (Cathay's) key shareholders, Swire Pacific and Air China", they added, helping strengthen the firms' strategic control of the airline."
Qatar Airways will divest its full 9.57% holding in Cathay Pacific through an $896 million share buyback, ending eight years of ownership. Cathay Pacific shares rose 4.2% on the Hong Kong Stock Exchange following the filing. The buyback is subject to shareholder approval. Cathay Group chairman Patrick Healy framed the repurchase as confidence in the group's future and support for Hong Kong's aviation hub. CEO Badr Mohammed al-Meer described the move as disciplined portfolio management to deliver sustainable shareholder value after a period of strong performance. Analysts said limited strategic influence and consolidation among Swire Pacific and Air China likely influenced the decision.
Read at Fast Company
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