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HONG KONG - SINGAPORE Airline's (SIA) offer to pay HK$7.16 billion (S$1.3 billion) for a 24 per cent stake in China Eastern Airlines was the only one on the table and shareholders should look at the long-term benefits of the tie-up, the Chinese carrier's chairman said on Thursday.
Some critics have suggested the offer, equal to about HK$3.80 a share, is too low. China Eastern was trading at HK$6.66 a share on Thursday afternoon.
But China Eastern Chairman Li Fenghua said that deal was the only one available and the price wouldn't be raised.
Singapore Airlines, which is making the offer with its parent, government investment arm Temasek Holdings, made a similar comment on Wednesday, calling its offer price the 'ceiling.'
Shareholders should focus on the long-term benefits of the deal when they vote Jan 8, not just on the share price, Mr Li said in a news conference in Hong Kong.
Mr Li also said it was unlikely state-run China National Aviation Holding , the parent company of Air China and a large minority shareholder, would vote against the deal.
There has been much speculation that China National Aviation might try to block the deal, which could pose a major competitive threat to its own business.
Mr Li said the central government in Beijing views the deal as being in China's national interest and that would keep Air China's parent from voting against it.
'We don't believe Air China will vote against the deal ... they have to know who the boss is,' Mr Li said. -- AP
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