China Increases Air Macau Stake - Report

Two companies controlled by Macau chief executive Edmund Ho have sold a combined 1.25 percent stake in financially troubled Air Macau to a unit of China flagship carrier Air China, the South China Morning Post reported Wednesday, citing sources.

The stake sale for an undisclosed sum was confirmed by sources at Air China, a unit of Air Macau controlling shareholder China National Aviation Corporation (CNAC).

The deal comes weeks after Air Macau's shareholders voted to approve a MOP$507.3 million pataca (USD$65 million) rescue package by the Macau government, the newspaper said.

Ho, whose term at the top post in Macau ends in December, was a founding shareholder of Air Macau when the airline was set up in 1994.

CNAC's voting interest in the Macau airline increases to 52.25 percent following the deal, the paper said.

Other shareholders include Portuguese airline TAP, which holds a 15 percent stake, and Sociedade de Turismoe Diversoes de Macau with 14 percent.

Portuguese-owned lender BNU, Taiwan's Evergreen Airways and the Macau government each hold 5 percent.

It gave no further financial details.

Late on Tuesday, Air China said it expected to see at least a 50 percent year-on-year rise in profit for the first half of 2009 as fuel purchase costs fell and the domestic air passenger market showed stable growth.