China Eastern Airlines is denying that it is holding takeover talks with any carriers apart from Great Wall Airlines, days after reports surfaced in China that the Government plans to merge ten airlines into three.

Shanghai-based China Eastern said in a statement last week that it was holding talks to buy into Great Wall Airlines and was discussing the possible sale of a stake in subsidiary China Cargo Airlines to Taiwan's China Airlines.

Soon after it made the comments state-run media in China reported that the regulatory Civil Aviation Administration of China (CAAC) was planning to have three major airline groups established in the country based around the so-called 'big three' Beijing-based Air China, China Eastern and Guangzhou-based China Southern Airlines.

While airline merger talk is not new in China the reports were more detailed than those issued previously by the Chinese Government and they have led to speculation that the CAAC may force mergers.

Source: Flight Daily News