Qatar Airways sells entire Cathay Pacific stake for $897 million

State-owned Qatar Airways has decided to merchantability its entire stake in Cathay Pacific Airways for astir $897 million (HK$6.97 billion), marking its implicit exit from Hong Kong's flagship hose aft 8 years.

Cathay said precocious connected Wednesday that the Doha-based bearer had approached it astir selling its entire 9.7% stake, and it would repurchase the shareholding done a buyback astatine HK$10.8374 per share, astir a 4% discount to its past closing stock price.

The Gulf bearer had bought the stake in November 2017 from Hong Kong's Kingboard Chemical Holdings, making it the third-largest shareholder in Cathay after Swire Pacific and Air China.

It was Qatar Airways' archetypal large concern successful an Asian hose and was aimed astatine boosting its planetary power and expanding postulation done its Doha hub.

Qatar Airways CEO Badr Mohammed Al-Meer said the exit reflected the company's disciplined portfolio strategy and followed a play of beardown results, allowing the institution to optimize investments and presumption itself for semipermanent growth.

The Middle Eastern hose has pursued a strategy of investing successful airlines worldwide to fortify its competitory position, including successful British Airways parent IAG, South American bearer LATAM and Virgin Australia.

Cathay is paying astir a 35% premium implicit the price Qatar Airways originally paid for the stake to bargain it back. The Hong Kong bearer said it would money the woody done interior resources and existing recognition lines.

Cathay Chairman Patrick Healy said the stake buyback reflected "strong" assurance successful the company's future. The hose has laid retired an concern program of HK$100 cardinal implicit 7 years that includes fleet renewal, compartment products and lounges.

If the woody is approved, controlling shareholder Swire Pacific's stake in Cathay will emergence to 47.69% from 43.12%, portion Air China's shareholding volition summation to 31.78% from 28.74%.

Cathay and Qatar Airways said they would proceed their concern done the oneworld Alliance.