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Domestic

China Eastern, Yunnan govt to set up JV

By Zhang Jiawei (China Daily)
Updated: 2009-06-02 10:33

China Eastern signed a strategic cooperation agreement with Yunnan's provincial government to establish a joint venture Sunday, in Kunming, capital of the province.

Under the agreement, the State-owned Assets Supervision and Administration Commission (SASAC)?of Yunnan Provincial People's Government, will cooperate with China Eastern in establishing a Yunnan-based joint venture for air transportation.

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China Eastern will hold 65 percent of the new company's equity and the remaining 35 percent will be held by Yunnan SASAC. The exact amount and form of the investment have not been released.

According to officials from China Eastern Yunnan branch, China Eastern's investment will be in the form of assets and cash with the former being the main component. The investment of Yunnan government is still under discussion.

The new company's name is also under speculation, with some suggesting "China Eastern Yunnan Co Ltd."

Aaccording to Liu Shaoyong, president of China Eastern, either "China Eastern Yunnan Co Ltd" or "Yunnan China Eastern Co Ltd" will be used.

The Yunnan side wishes to keep the golden peacock symbol, which was used by the former Yunnan Airlines, in the new company. Yunnan Airlines, founded in 1993, was merged into China Eastern Airlines in 2002 and became a branch company of China Eastern.

"We?hope the golden peacock will soon fly into the sky and the new company?will complete establishment as soon as possible," said Liu.

With the support of the Yunnan government and the geographical advantage of connecting Southeast Asia and South Asia, the new company seeks to expand business in these regions.

The new company is said to focus on developing into a competitive company in Yunnan's airlines market, providing better service for Yunnan's political, economic, tourism and cultural development.

As with the new company's aviation code, further discussion will be needed, according to China Eastern Yunnan branch's officials.

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