AIR Zimbabwe is in take-over talks with China’s largest privately-owned airline, officials confirmed after a meeting with President Robert Mugabe in Beijing on Thursday.
Hainan Airlines, one of only seven airlines in the world to be given a 5-star rating by the independent research consultancy firm Skytrax, operates 112 planes and flies to 90 destinations.
The airline’s board chairman Chen Wenli met Mugabe to discuss government plans to give up a substantial shareholding in Air Zimbabwe to save it from collapse.
Wenli said they were studying a proposal put forward by the Zimbabwe government for a take-over, in a deal thought to be structured in the same way as Essar’s acquisition of Ziscosteel earlier this year. In that deal, the government waived a legal requirement for at least 51 percent shareholding to be retained by locals to force a deal through.
The government has already absorbed Air Zimbabwe’s US$140 million debt to clear a major hurdle in the take-over talks.
Zimbabwe's Ambassador to China, Frederick Shava, said talks with Hainan Airlines had opened before Mugabe’s visit to China. Mugabe met Wenli to make a "follow-up", he added.
“Hainan said they are still studying some aspects of the proposal and soon they should be able to define the nature of the relationship (with Air Zimbabwe). They are a very viable airline themselves operating here in China and Asia," Shava said.