Shares in China Southern Airlines entered a trading halt this morning ahead of an expected announcement on the possible sale of a stake in the carrier to American Airlines.
In a statement to the Hong Kong Stock Exchange, China Southern requested the trading halt “pending the release of an announcement in relation to a possible major strategic cooperation”.
The company is in advanced talks to sell a $200m stake to American Airlines, Bloomberg reported citing people familiar with the matter. The news outlet said that under the discussions, it was possible AA might nominate an observer without voting rights to the Chinese company’s board.
China Southern has a market capitalisation of $10bn, half that of Texas-based AA. Shares in American Airlines closed 0.2 per cent lower on Wednesday in New York.
China Southern is also listed on the Shanghai Stock Exchange.