(South China Morning Post)
Updated: 2007-08-13 14:57

Juneyao Airlines, a privately owned mainland airline, plans to raise US$150 million by offering 20 per cent to 25 per cent of its aviation business to overseas strategic investors.

"We hope to tie up with foreign investors who can bring in management expertise as well as help us expand our fleet and upgrade technologies," chief executive Bryan Huang Hui told the South China Morning Post. "Juneyao is aiming to set up a sound management system to benefit from China's sizzling economy."

Last month, Juneyao hired Citigroup as its financial adviser for the share sale.

A deal was expected to be in place before the year-end, making Juneyao the first mainland private airline to bring in overseas capital and funds, Mr Huang said. The share sale will be a prelude to a likely initial public offering on an overseas stock market late next year or early in 2009.

The share sale had attracted keen attention from the financial and business community, with interest already shown by some private equity funds and hedge funds, Mr Huang said.

The former China president of BearingPoint, a global technology and management consultancy, said Juneyao would take a global perspective as it seeks to be distinct from domestic rivals.

"We are eyeing a model that fits China," he said. "Juneyao Airlines will focus on offering premium services to cater for mainland passengers, particularly the business travellers."

Juneyao Airlines made its maiden flight in September last year and now has four planes, compared with low-cost carrier Okay with six. The group aims to expand its fleet to 67 planes by 2010 - with Juneyao Airlines flying 30 aircraft and Okay the remaining 37, including 20 for passenger flights and 17 for cargo.