July 6, 2011 / 5:07 AM / 8 years ago

Air China to set up $155 mln subsidiary in northeast China

BEIJING, July 6 (Reuters) - Air China has obtained regulatory approval to set up a subsidiary in northeast China as it continues to expand its footprint in the country’s highly competitive air travel market.

Air China will hold 80 percent of Dalian Air, capitalised at 1 billion yuan ($155 million), with a unit of the Dalian city government holding the remainder, the Civil Aviation Administration of China (CAAC), China’s top aviation regulator, said on its website late Tuesday.

Major Chinese carriers, which also include China Eastern Airlines and China Southern Airlines , have been competing fiercely for a bigger share of the market.

Earlier in the month, Shanghai-based China Eastern got the green light to set up a 3.7 billion yuan airline in the southern province of Yunnan in partnership with the local government, holding a 65 percent stake.

Beijing-based Air China already secured a foothold in the south years ago via its subsidiary Shenzhen Air. China Southern also gained an entry into the western region via affiliate Sichuan Air. ($1 = 6.468 yuan) (Reporting by Fang Yan and Ken Wills; Editing by Jonathan Hopfner)

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