Okay Airways, one of China’s first privately held airlines, is looking for investment from foreign airlines
One of China’s first privately owned carrier, Okay Airways, is seeking investment from foreign airlines as it looks to expand internationally and eventually launch routes to Europe and America. The Beijing-headquartered company began operations in 2005 and has a fleet of 26 Boeing 737 planes which serve more than 70 domestic and regional destinations.
Currently, it is inviting foreign airlines to take a stake in the carrier as it prepares for a possible stock market listing in mainland China, Li Zongling, the company's president said on Monday. Okay Airways wants a "reputable" foreign airline to take an upwards of 10 percent stake in the Chinese carrier. He said that the company has held talks with airlines in Europe and Asia but declined to identify the airlines. He hopes international airlines who are interested in the Chinese market and in private Chinese carriers will look at becoming a shareholder in Okay Airways citing Emirates and Singapore Airlines as examples of reputable airlines. Li said that Okay Airways has ambitions to become a more international company, with plans to eventually launch routes to Europe and America, and believed that having a foreign airline as a shareholder will aid that goal. He added that joining an airline alliance will not be as effective for its international business as it would have in the past and hoped to find a partner this year.
Okay Airways is currently in talks with a Southeast Asian carrier to set up a joint venture company in the region to expand their route network. Li added that the airline was in a position to accept foreign investment because it is still wholly privately owned, though it plans to seek a stock market listing between 2020 and 2021 after it opens its base at Beijing's new airport and receives the first of five Boeing 787-9 Dreamliners that it bought for $1.4 billion at list prices in November.
As part of the China’s mixed-ownership drive involving the country’s private and state firms, Okay Airways is also seeking Chinese state investors to become shareholders in the company. Li also expected local government subsidies that have encouraged airlines to launch numerous new routes from Chinese cities to overseas destinations to shrink this year as the aviation regulator expressed a lack of support for the practice. Li said that Okay Airways has also been a beneficiary of these cash subsidies, but ultimately they were not sustainable and expects that authorities may shift to other types of incentives to support the market.