Cathay Pacific Airways is to raise HK$2.62 billion from the sale of its stake in Hong Kong Aircraft Engineering Co to its parent.

Hong Kong's de facto flag carrier will sell 24.95 million shares or 15 percent of HAECO to Swire Pacific for HK$105 each.

The sale price represents a 25 percent premium to HAECO's closing price of HK$84 on June 4.

Swire will own 60.96 percent of HAECO and Cathay will cease to hold any equity in the aircraft maintenance firm on completion of the unconditional transaction.

The deal is expected to be completed by June 14.

"The transaction is driven by the strategic priorities of Cathay Pacific and will benefit our core aviation business," Cathay chief operating officer John Slosar said.

The airline will record a profit of about HK$1.83 billion from the deal. The long-standing operational relationship between Cathay and HAECO would remain unchanged, Slosar said.

HAECO is the carrier's main provider of overhaul and maintenance services.

This is Cathay's second disposal of its non-core business in a month, after the carrier announced it was disposing of its 10 percent stake in Hong Kong Air Cargo Terminal in late May for HK$640 million.

Shares of Cathay, Swire and HAECO resume trading today after being suspended yesterday pending the announcement of the deal.