UNITED STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM
6-K
Report
of Foreign Private Issuer
Pursuant
to Rule 13a-16 or 15d-16
under
the Securities Exchange Act of 1934
For the
month of December 2009
Commission
File Number: 001-14550
China
Eastern Airlines Corporation Limited
(Translation
of Registrant’s name into English)
2550
Hongqiao Road
Hongqiao
Airport
Shanghai,
China 200335
(Address
of principal executive offices)
Indicate
by check mark whether the registrant files or will file annual reports under
cover of Form 20-F or Form 40-F: x Form
20-F ¨ Form
40-F
Indicate
by check mark if the registrant is submitting the Form 6-K in paper as permitted
by Regulation S-T Rule 101(b)(1): ¨
Indicate
by check mark if the registrant is submitting the Form 6-K in paper as permitted
by Regulation S-T Rule 101(b)(7): ¨
Indicate
by check mark whether the registrant by furnishing the information contained in
this Form is also thereby furnishing the information to the Commission pursuant
to Rule 12g3-2(b) under the Securities Exchange Act of 1934: ¨ Yes x No
If "Yes"
is marked, indicate below the file number assigned to the registrant in
connection with Rule 12g3-2(b): n/a
SIGNATURES
Pursuant to the requirements of the
Securities Exchange Act of 1934, the registrant has duly caused this report to
be signed on its behalf by the undersigned, thereunto duly
authorized.
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China Eastern Airlines Corporation
Limited
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(Registrant)
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Date
December 28,
2009
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By
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/s/ Luo Zhuping
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Name:
Luo Zhuping
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Title:
Company
Secretary
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Certain
statements contained in this announcement may be regarded as "forward-looking
statements" within the meaning of the U.S. Securities Exchange Act of 1934, as
amended. Such forward-looking statements involve known and unknown risks,
uncertainties and other factors, which may cause the actual performance,
financial condition or results of operations of the Company to be materially
different from any future performance, financial condition or results of
operations implied by such forward-looking statements. Further information
regarding these risks, uncertainties and other factors is included in the
Company's filings with the U.S. Securities and Exchange Commission. The
forward-looking statements included in this announcement represent the Company's
views as of the date of this announcement. While the Company anticipates that
subsequent events and developments may cause the Company's views to change, the
Company specifically disclaims any obligation to update these forward-looking
statements, unless required by applicable laws. These forward-looking statements
should not be relied upon as representing the Company's views as of any date
subsequent to the date of this announcement.
Hong
Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited
take no responsibility for the contents of this announcement, make no
representation as to its accuracy or completeness and expressly disclaim any
liability whatsoever for any loss howsoever arising from or in reliance upon the
whole or any part of the contents of this announcement.
(A joint stock
limited company incorporated in the People’s Republic of China with limited liability)
(Stock code: 00670)
MAJOR TRANSACTION
PURCHASE OF SIXTEEN AIRBUS A330 SERIES AIRCRAFT
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On
28 December 2009, the Company entered into the Agreement with Airbus SAS
regarding the purchase of sixteen Airbus A330 series aircraft (with
engines).
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The
Agreement constitutes a major transaction of the Company under the Listing
Rules as applied by the Stock Exchange and is subject to shareholders’
approval.
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CEA
Holding, which directly or indirectly holds approximately 70.538% of the
issued share capital of the Company, does not have any interest or benefit
under the Agreement. No shareholder (including CEA Holding) would be
required to abstain from voting at any shareholders’ general meeting, if
convened, to approve the Agreement. The Agreement has accordingly been
approved in writing by CEA Holding pursuant to Rule 14.44 of the Listing
Rules, and no general meeting is required to be
convened.
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The
Company will issue and despatch to its shareholders a circular containing
the information required under the Listing Rules in relation to the
Agreement in due course.
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THE AGREEMENT
On 28
December 2009, the Company entered into the Agreement with Airbus SAS regarding
the purchase of the Aircraft in accordance with the terms and conditions
thereof.
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To the
best knowledge, information and belief of the Directors having made all
reasonable enquiry, Airbus SAS and its ultimate beneficial owner(s) are third
parties independent of the Company and connected persons (as defined in the
Listing Rules) of the Company, and are not connected persons of the
Company.
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Aircraft
to be acquired
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:
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The
Aircraft (i.e. sixteen brand new Airbus A330 series aircraft (with
engines)).
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Consideration
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:
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The
aircraft basic price of the Aircraft in aggregate is approximately
USD2.599 billion (RMB17.749 billion) based on the relevant price catalog
in 2007. Such aircraft basic price comprises the airframe price (which is
subject to price adjustment by applying a formula), optional features
prices and engine price.
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The
Agreement was negotiated and entered into in accordance with customary
business and industry practice, under which Airbus SAS has granted to the
Company material price concessions with regard to the Aircraft. These will
take the form of credit memoranda which may be used by the Company towards
the purchase of the spare parts of the Aircraft, goods and services or may
be used towards the final delivery invoice payment of the Aircraft. Such
credit memoranda were determined after arm’s length negotiations between
the parties and as a result, the actual consideration for the Aircraft is
substantially lower than the aircraft basic price of the Aircraft
mentioned above.
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Based
on such actual consideration under the Agreement, the relevant
‘‘percentage ratio’’ calculated under Rule 14.07 of the Listing Rules at
the material time is above 25% but less than 100%, the Agreement
constitutes a major transaction of the Company under the Listing Rules as
applied by the Stock Exchange. In respect of the transaction, the Company
understands its disclosure obligations normally required under Chapter 14
of the Listing Rules, and has therefore on separate occasions raised the
issue with Airbus SAS in order to seek its consent to the Company’s
disclosing certain otherwise required information (including the relevant
consideration involved) in the relevant announcements and circulars.
Nonetheless, Airbus SAS, for business reasons and from a commercial
perspective, did not accede to the Company’s request in this respect, and
insisted preservation of the confidentiality carried with such information
to the extent possible. The Company has made an application to the Stock
Exchange for a waiver from strict compliance with the relevant provisions
(including Listing Rules 14.58(4) and 14.66(4)) under the Listing Rules in
respect of the disclosure of the actual consideration for the
Aircraft.
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The
price concessions will mainly affect the depreciation of aircraft in the
operation cost of the Company. The Company confirms that the extent of the
price concessions granted to the Company under the Agreement is more
favourable than the price concessions that the Company had obtained under
its previous agreement entered into in October 2004 with Airbus SAS
regarding the purchase of certain Airbus A330 series aircraft. The Company
believes that there is no material impact of the price concessions
obtained under the Agreement on the Company’s operating costs taken as a
whole.
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The
Company has also taken into account the current economic environment, the
industry performance and the Company’s financial position, and considers
that the extent of the price concessions granted to the Company under the
Agreement are fair and reasonable and in the interests of the shareholders
of the Company.
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Payment
terms and source of funding
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:
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The
consideration under the Agreement is payable by cash in United States
dollars in instalments, and is, as currently contemplated, being funded
through bank loans from commercial banks.
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Delivery
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:
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The
Aircraft are expected to be delivered to the Company in stages from 2011
to 2014.
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GENERAL
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The
Company and Airbus SAS
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:
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The
Company is principally engaged in the business of civil
aviation.
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Airbus
SAS, to the knowledge of the Directors, is principally engaged in the
business of manufacturing and selling aircraft.
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Reasons
for entering into the transaction and benefits expected to accrue to the
Company
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:
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The
Aircraft will primarily be used to satisfy the demand arising from the
growth of the market of long-and-medium-haul routes passenger air
transportation for the coming years, and strengthen the Company’s
operational capabilities in the long-and-medium-hand routes passenger air
transportation market. The transaction will optimize the overall fleet
structure of the Company and enhance the construction of airline network.
The transaction will also provide a more comfortable services to the
passengers and increase the Company’s overall
competitiveness.
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Without
considering the adjustments to be made to the aircraft fleet of the Group
as a result of the market conditions and the age of the aircraft, based on
the ATKs of the Group as at 31 December 2008, the addition of the Aircraft
will increase the ATKs of the Group by 19.52%. In addition, based on the
ATKs of the Group and 上海航空股份有限公司 (Shanghai
Airlines Co., Ltd) as at 31 December 2008, the addition of the Aircraft
will increase the ATKs of the Group as enlarged by the completion of the
absorption of 上海航空股份有限公司 (Shanghai
Airlines Co., Ltd) by 15.22%.
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The
addition of the Aircraft is part of the whole plan of the Company to
condense its aircraft models and optimize its fleet structure. At the same
time of the introducing of the Aircraft, the Company will phase out some
old models of its existing aircraft step by step according to the hub
network strategy of the Company and considering the then market
demand.
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As
mentioned above, the consideration is, as currently contemplated, being
funded through bank loans from commercial banks. The transaction may
therefore result in an increase in the Company’s debt-to-equity ratio, but
as the consideration under the Agreement is payable by instalments, it is
not expected to have substantial impact on the Company’s cash-flow
position or its business operations and the purchase of the Aircraft will
not add immediate financial burden to the Company.
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The
transaction has been approved by the board of Directors, and is subject to
approval by the relevant regulatory authority(ies) in the PRC in
compliance with the relevant regulatory requirements.
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The
Directors believe that the terms of the Agreement (including the price
concessions under the Agreement) are fair and reasonable and in the
interests of the Company’s shareholders as a whole.
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Major
transaction
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:
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The
Agreement constitutes a major transaction of the Company under the Listing
Rules as applied by the Stock Exchange and is subject to shareholders’
approval.
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CEA
Holding, which holds approximately 70.538% of the issued share capital of
the Company, does not have any interest or benefit under the Agreement. No
shareholder (including CEA Holding) would be required to abstain from
voting at any shareholders’ general meeting, if convened, to approve the
Agreement.
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The
Agreement has accordingly been approved in writing by CEA Holding pursuant
to Rule 14.44 of the Listing Rules, and no general meeting is required to
be convened.
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FURTHER INFORMATION
The Company will issue and despatch to its shareholders a circular containing the information required
under the Listing Rules in relation to the Agreement in due course.
DEFINITIONS
In this announcement, unless the context otherwise requires, the following terms shall have the
following meanings:
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‘‘Agreement’’
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means
the agreement entered into on 28 December 2009 by the Company with Airbus
SAS regarding the purchase of the Aircraft;
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‘‘Airbus
SAS’’
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means
Airbus SAS, a company created and existing under the laws of
France;
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‘‘Aircraft’’
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means
sixteen brand new Airbus A330 series aircraft (with
engines);
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‘‘ATKs’’
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means
the tones of capacity available for the transportation of revenue load
(passengers and/or cargo) multiplied by the kilometers
flown;
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‘‘CEA
Holding’’
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means
中國東方航空集團公司 (China
Eastern Air Holding Company), a wholly PRC State-owned enterprise and the
controlling shareholder of the Company holding (directly or indirectly)
approximately 70.538% of its issued share capital as at the date of this
Announcement;
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‘‘Company’’
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means
中國東方航空股份有限公司 (China
Eastern Airlines Corporation Limited), a joint stock limited company
incorporated in the PRC with limited liability, whose H shares, A shares
and American depositary shares are listed on the Stock Exchange, the
Shanghai Stock Exchange and the New York Stock Exchange, Inc.,
respectively;
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‘‘Directors’’
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means
the directors of the Company;
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‘‘Group’’
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means
the Company and its subsidiaries;
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‘‘Hong
Kong’’
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means
the Hong Kong Special Administrative Region of the People’s Republic of
China;
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‘‘Listing
Rules’’
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means
the Rules Governing the Listing of Securities on The Stock Exchange of
Hong Kong
Limited;
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‘‘PRC’’
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means the People’s Republic of China;
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‘‘RMB’’
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means renminbi, the lawful currency of the PRC;
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‘‘Stock Exchange’’
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means The Stock Exchange of Hong Kong Limited; and
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‘‘USD’’
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means United States dollar, the lawful currency of the United States of
America.
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For
illustration purpose only, translation of USD to RMB is made in this
announcement at the rate of USD1.00 to RMB6.83. No representation is made that
any amount in RMB or USD could have been or could be converted at such rate or
at any other rate or at all.
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By order of the board of the Directors
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CHINA EASTERN AIRLINES CORPORATION LIMITED
Luo Zhuping
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Director and Company Secretary
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The Directors as at the date of this announcement are:
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Liu Shaoyong
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(Chairman)
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Li Jun
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(Vice Chairman)
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Ma Xulun
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(Director, President)
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Luo Chaogeng
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(Director)
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Luo Zhuping
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(Director, Company Secretary)
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Hu Honggao
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(Independent
Non-executive Director)
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Wu Baiwang
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(Independent
Non-executive Director)
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Zhou Ruijin
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(Independent
Non-executive Director)
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Xie Rong
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(Independent
Non-executive Director)
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Sandy Ke-Yaw Liu
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(Independent
Non-executive Director)
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Shanghai, the PRC
28 December 2009
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