China Eastern Airlines said it will continue to seek a big-name strategic investor following the expiry of an agreement on a stake sale to Singapore Airlines.
"The company will persist in the direction of introducing strategic investors and will continue to develop opportunities of business cooperation with strategic investors of world renown," China Eastern Airlines Director Luo Zhuping said in a statement issued late on Sunday.
China Eastern said an agreement for Singapore Airlines to invest in the company had expired as conditions for an investor subscription pact among Singapore Airlines, Temasek Holdings and the Chinese airline had not been satisfied.
Singapore Airlines and its majority owner Temasek Holdings agreed in November 2007 to buy a 24 percent stake in China Eastern for $920 million, but the deal was rejected by China Eastern's minority shareholders in January, with many complaining that the stake was being sold too cheaply.
Singapore Airlines, the world's largest airline by market value, said on Sunday its offer to buy a stake in China Eastern expired on Aug. 9 and that it would now seek other ways to build ties with the mainland carrier.
A China Eastern executive had recently told Reuters that a deal was unlikely to be completed before the Aug. 9 expiry date, given preoccupations with issues related to this month's Beijing Olympic Games.
But the airline, dogged by a reputation for poor service and keen for a foreign partner with the expertise to help shore up its operations, had said it would focus on talks with Singapore Air once more after the Olympics.
A Chinese business daily, The 21st Century Business Herald, quoted unnamed sources on Friday as saying that Singapore Airlines had indicated it would not extend its agreement to seek an equity tie-up after the Aug. 9 expiry.
Shares of China Eastern have fallen more than 72 percent so far in 2008, ending at HK$2.14 on Friday. Hong Kong's benchmark Hang Seng Index has fallen 21 percent since the start of the year.