Soros keen to invest more in airline

HONG KONG - American financier George Soros may invest another US$25 million ($36 million) in Hainan Airlines, part of a plan to reorganise China's fourth-largest carrier.

Soros, who paid about US$24 million in 1995 for 14.8 per cent of Hainan Airlines, may sign the investment agreement during a visit this weekend to the carrier on southern China's Hainan island, said three unnamed company executives.

Soros, who last year called Hainan Airlines "a fine company", is almost doubling his investment in 10 years, preparing to tap the estimated 70 million visitors to China during the 2008 Beijing Olympics and 2010 World Expo in Shanghai.

The carrier needs funds to take over three smaller carriers and buy new aircraft, including the jumbo Airbus A380, to compete with China Southern Airlines and Cathay Pacific.

"It sounds like a careful step, not a huge expansion" because the investment by Soros "won't even buy one Airbus" plane, said Doug McVitie, managing director of Arran Aerospace, a French consulting company.

"It's a vote of confidence in an airline by someone whose financial reputation is undisputed."

- BLOOMBERG