Cathay Pacific Shareholders Back Qatar Buyback
Cathay Pacific shareholders have approved the off-market repurchase of the entire 9.6% stake held by Qatar Airways, paving the way for the transaction to complete on February 24.
According to a February 12 filing with the Hong Kong stock exchange, the special resolution passed with 99.9% of independent votes cast in favour. Qatar Airways, which owns 643,096,181 shares in the Hong Kong-based carrier, abstained from voting in compliance with Hong Kong’s share buyback code.
The buyback is valued at HKD6.9 billion (USD891.8 million), with shares priced at approximately HKD10.80 (USD1.40) each. Cathay Pacific and Qatar Airways executed the buyback agreement immediately following the shareholder meeting, having secured prior consent from the Securities and Futures Commission.
Once completed, the total number of issued Cathay Pacific shares will decrease from about 6.7 billion to 6.1 billion, resulting in a capital reduction that reshapes the airline’s shareholder structure. Swire Pacific’s ownership stake will increase to approximately 47.7%, reinforcing its position as the largest shareholder. Meanwhile, Air China’s stake will settle just below 30%.
Air China previously divested a 1.6% holding in early January to prevent the transaction from triggering a mandatory general offer requirement under Hong Kong regulations, which would have applied if its stake had exceeded the 30% threshold.
Qatar Airways’ exit reflects a portfolio optimisation strategy as the Gulf carrier reallocates capital across its global investments. Despite divesting its equity stake, Qatar Airways will continue to cooperate closely with Cathay Pacific through their membership in the Oneworld alliance, maintaining codeshare arrangements and network collaboration.
The transaction marks a significant shift in Cathay Pacific’s ownership structure at a time when the Hong Kong-based airline is rebuilding capacity and strengthening its financial position following the pandemic. By consolidating its shareholder base and reducing outstanding shares, Cathay Pacific aims to enhance long-term shareholder value while maintaining strategic partnerships across its global network.
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Sources: AirGuide Business airguide.info, bing.com, ch-aviation.com