China Eastern still vying for a deal with Singapore Airlines

China Eastern Airlines refuted reports in the media that it planned to merge with Shanghai Airlines. The airline said that it received no such directive from the Chinese government, adding that there had been no negotiations.

China Eastern Airlines is controlled by the Assets Supervision and Administration Commission of the State Council. The Assets Supervision and Administration Commission of the Shanghai Municipal Government controls SAL.

China Eastern said that the quotes that had been attributed to China Eastern's managing director Cao Jianxiong were inaccurate. Media reports had quoted Jianxiong as having said that a merger with SAL was almost definite, even before any deal with potential strategic investor Singapore Airlines.

The statement reaffirms Singapore Airlines as China Eastern's "preferred partner", even though the stake sale deal between them expired on 9 August. The preference for Singapore Airlines stems from the perceived benefit of the alliance being able to diversify China Eastern's stake holding pattern, capitalise on management expertise that Singapore Airlines would bring with it, and last but not the least, the infusion of funds.