Cathay mulls buying back HK$6.96bn stake from Qatar Airways

Cathay Pacific Airways is mulling to repurchase the 9.57% stake held by Qatar Airways for HK$6.96 billion (US$896 million), following the Middle Eastern airline’s decision to divest its shares.

On Wednesday night, the Hong Kong carrier said that Qatar Airways would sell its entire holding of 643.07 million shares at HK$10.8374 per share, pending approval from Cathay’s independent shareholders.

The offer price reflects a 3.9% discount to Wednesday’s closing price of HK$11.28, but a 0.5% premium over the 30-day average closing price of HK$10.78. Cathay said it intends to finance the transaction using internal funds and existing credit facilities.

Cathay group chair Patrick Healy said the buy-back reflects Cathay's strong confidence in the future of the Cathay Group and underscores its commitment to the development of the Hong Kong international aviation hub.

"Together with our investment of well over HK$100 billion into our fleet, cabin and lounge products, and digital leadership, we are firmly focused on sustainably growing our business to strengthen Hong Kong’s status as a world-class aviation hub and contribute to the prosperity of the wider Greater Bay Area. I would like to extend my gratitude to Qatar Airways for their unwavering support over the years, and I look forward to continuing our close partnership through the oneworld alliance relationship. I would also like to thank our shareholders, Swire Pacific and Air China, for their continued trust and support," he added.

Qatar Airways group CEO Engr. Badr Mohammed Al-Meer said: “This agreement reflects Qatar Airways Group’s disciplined approach to portfolio management and our commitment to delivering sustainable value for our shareholders. Following a period of record profitability and strong performance, this decision is part of a proactive strategy to optimise our investments and position the group for long-term growth."

"While we adjust our shareholding, we look forward to continuing our collaboration with Cathay through the oneworld alliance to continue delivering benefits that enhance connectivity and choice for our passengers. Hong Kong remains an important market to Qatar Airways, and we remain fully committed to serving it through our flights and codeshare agreements, offering travellers a seamless and world-class experience that reflects the highest standards of quality, service and innovation," he added.

MARKETING-INTERACTIVE has reached out to Cathay for more information. 

Qatar Airways currently flies to over 170 destinations worldwide, connecting through its Doha hub, Hamad International Airport. Before Qatar Airways became a shareholder, Cathay operated flights between Hong Kong and Doha under a codeshare agreement from 2014 to 2016, but the route was discontinued due to “commercial reasons".

Cathay Pacific said during the time that it will continue to work with Qatar Airways as strategic airline partners within the oneworld alliance. The Cathay Pacific “CX” code will remain in place on Qatar Airways flights between Doha and Hong Kong, while the Qatar Airways “QR” code will remain on selected Cathay Pacific flights from Hong Kong to Australia, New Zealand, Korea and Japan.

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