Hainan Airlines Takes Lion's Share in Cambodian National Airlines

Home>>Business

Last updated at: (Beijing Time) Thursday, February 28, 2002

Hainan Airlines Takes Lion's Share in Cambodian National Airlines

China's Hainan Airlines is set to hold a controlling 49 percent stake in the restructured Royal Air Cambodge (RAC), Cambodia's national flag carrier, according to an agreement signed recently.

DISCUSSION

CHINESE

SEND TO FRIEND

China's Hainan Airlines is set to hold a controlling 49 percent stake in the restructured Royal Air Cambodge (RAC), Cambodia's national flag carrier, according to an agreement signed recently.

The framework pact signed between Hainan Airlines, the Cambodian government and the Cambodian CTG company allows the Chinese airlines' a 49 percent stake in the new RAC, which will have a registered capital of 10 million U.S. dollars.

Hainan Airlines will be the largest shareholder in the new airlines. It will also be the first Chinese airlines to participate in the formation of a foreign national airlines, industrial sources said.

Launched in 1994, RAC was once operating seven international air routes to Bangkok, Kuala Lumpur, Guangzhou, Shanghai and other cities, before mismanagement forced it to stop operation last October.

The new Cambodian national airlines will replace RAC and enjoys priority on both domestic and international routes.

In the beginning of its operation, the new Cambodian airlines is expected to acquire two Boeing 737-400 jets from Hainan airlines in the form of wet renting.

Hainan Airlines is one of the most successful local airlines in China. The group now owns a fleet of 60 airplanes and offers nearly 2,000 flights a week.

Royal Air Cambodge went Bankrupt

Royal Air Cambodge (RAC), the Cambodia's national airline, is going bankrupt and stopped all its flying operation on October 16, 2001.

The Cambodian government owns 60% share of this airline whereas the Naluri, a Malaysian company (formerly known as Malaysian Helicopter Service) - owns the rest 40%.

RAC leased its planes from the Malaysian Airline, since its birth 7 years ago. Due to its debt-ridden situation, RAC fails to pay the rental fees so its planes have been repossessed. It is estimated that RAC owes Malaysian Airline about US$ 30 million.

An airline official said that the issued air tickets will be reimbursed, but this information has not been confirmed.

RAC used to be a major player in flying between Phnom Penh and Siem Reap; the latter of which houses the world's famous Angkor Wat and other Khmer complex. Before its closure, RAC operates about 3-4 flights a day on this domestic route. Currently, the Siem Reap Airways (FT) is the sole carrier, operating two flights a day from Phnom Penh to Siem Reap and return.

Visit Website of Hainan Airlines

Questions?Comments? Click here

Hainan Airlines Leases Boeing 737-800 Airplanes

Hainan Airlines to Open East China Routes