Hainan Airlines Company Limited plans to spend 1.08 billion yuan in purchasing a 32.41% stake in China Xinhua Airlines, aiming at a wholly shareholding of the latter.

In order to increase its shareholding percentage of the subsidiary, Hainan Airlines Friday announced that it plans to acquire the rest 32.41% stake of China Xinhua Airlines held by Grand China Air with 1.08 billion yuan.

About China Xinhua Airlines

China Xinhua Airlines, with its headquarter established in Beijing, was founded in August 1992, mainly dealing with domestic passenger and freight transportation. The carrier was merged into Shenhua Group Cooperation Limited in October, 1998.

In 2001, invested by Hainan Airlines, Shenhua Group and HNA Group jointly, the carrier reformed to be a limited company. After its re-organization, the new holding company was held jointly by Hainan Airlines (51%), Shenhua Group (40%) and HNA Group (9%). In 2002, HNA Group and Hainan Airlines reached a swap assets agreement. According to the agreement, Hainan Airlines acquired the 9% stake in Xinhua Airlines held by HNA Group, making the carrier's shareholding percentage of Xinhua Airlines up to 60 percent. Since then, Xinhua Airlines moved its headquarter to Haikou, Hainan province.

About Grand China Air

Grand China Air was formed on November 29, 2007 under the initiative of the HNA group's largest operational entity, Hainan Airlines, to merge its operations with HNA Group's subsidiaries Shanxi Airlines, Chang'an Airlines, and China Xinhua Airlines. The airline is headquartered in Beijing and registered in Hainan province. When the merger is completed in the near future, the airline will become the 4th largest airline in China.