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Juneyao sells Okay stake to Beijing cargo company
Published on: 2010-03-23
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Juneyao Group sold its 63% stake in Tianjin-based Okay Airways to Chinese cargo and logistics company Da Tian W Group and said it prefers to concentrate on building its Shanghai-based Juneyao Airlines.

Okay was China's first privately run airline when it was launched in May 2004, but it has yet to turn a profit. The losses have been attributable partly to conflicts between Juneyao Group and other investors that resulted eventually in Okay's suspension of operations in December 2008. It resumed flying one month later, although disagreement about its future remained. Juneyao Group Chairman Wang Junjin then revealed he intended to sell its majority share in Okay to a strategic investor.

It is noteworthy that Juneyao also sold its stake in another privately held carrier, United Eagle Airlines, last year. "We want to focus our attention on Juneyao Airlines from now on, which might work better than making investments in other carriers," Wang explained.

The sale has been approved by CAAC, and DTW Chairman Wang Shusheng will become Okay chairman. Okay operates three 737-800s, three 737 freighters, two Yun-8s and one MA60 on more than 20 domestic routes. It will introduce three or four additional -800s and two more MA60s by year end and aims to expand its regional fleet to 10 aircraft over the next three years.

The carrier suffered a CNY500 million ($73.1 million) net loss last year and DTW is negotiating with several companies regarding further investment. Founded in 1992, Beijing-based DTW operates 23 international freight forwarding stations and 33 distribution centers. It sold its domestic courier network to FedEx in 2007.

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