China Eastern Airlines’ board has approved a $60 million loan to Jetstar Hong Kong.
The “shareholder’s loan” to associate Jetstar Hong Kong will be made through its wholly-owned company Eastern Air Overseas, says the carrier in a statement on the Hong Kong Exchange.
Jetstar Hong Kong is a joint venture between Qantas Airways, China Eastern, and Hong Kong conglomerate Shun Tak Holdings. Each shareholder will commit $66 million to the carrier’s capitalisation, payable in a series of tranches.
The proposed carrier applied for an air operator’s certificate last year but faced objections from the onset with Hong Kong carriers arguing that it does not meet regulatory requirements. They claim that ultimate control of the carrier lies in Australia.
Flightglobal’s Ascend Online database shows that Jetstar Hong Kong has five Airbus A320s in storage, all of which are owned by Qantas. It also has a further nine A320s on order.