Hong Kong-based CDR director Diana Footitt is advising the firm, which is the largest international carrier to and from China. CDR director David Westover is working on the deal in London.
Merrill Lynch has been appointed financial adviser to the deal, which could raise as much as £539m through an initial public offering in Hong Kong and London. The listing will begin on 25 November and close on 16 December.
Air China, which has 136 aircraft and 322 air routes, has declined to comment on its listing plans before it gets formal approval from the Hong Kong Stock Exchange. But it has been reported that it will sell around 30 per cent of its stock.
The listing would follow that of China’s other major airlines China Southern Airlines Co and China Eastern Airlines Corp. Cathay Pacific Airways plans to buy a 9.9 per cent stake in Air China as part of the restructuring of the company.
Cathay Pacific’s investment, which is reported to be worth £108m, would give the company access to China’s booming mainland market from which it has so far been largely excluded.
The two airlines will also co-operate on engineering, ground handling, catering, cargo services, information technology, purchasing, safety and security.
Air China has blamed a 17per cent fall in net income to £6m for 2003 on the damaging outbreak of the SARS virus in Asia that year. Profits for 2004 are expected to exceed £65m. Air China transported around 18 million passengers in 2003.
It has been reported that following the IPO, Air China plans to spend £1.2bn on buying 46 more aircraft by 2006 and on a new terminal at Beijing airport, Air China’s HQ.