Shares of China Eastern Airlines trimmed losses on the afternoon of Dec. 12 after a report that chairman of rival China Southern Airlines had been appointed chairman of China Eastern by the central government.

Shares of China Eastern, which fell 5.7 percent in the morning, trimmed losses to 4.7 percent. While shares of China Southern, which dropped 6.8 percent on the morning of Dec. 12, were down 7.5 percent in the afternoon.

The benchmark Hang Seng Index was down 6.9 percent in early afternoon trade.

Liu Shaoyong, chairman of China Southern Airlines, had been appointed chairman of rival China Eastern Airlines by the central government, two sources familiar with the situation said on Dec. 12.

The sources were confirming a report by the online edition of major Chinese financial magazine Caijing as saying the management reshuffle was part of preparations for a possible takeover of smaller Shanghai Airlines by China Eastern.

File Photo: Liu Shaoyong.