Virgin Australia board support Chinese shareholders nominate directors for airline’s board

VIRGIN AUSTRALIA AIRCRAFT SYD APR15 RF 5K5A1324 — Virgin Australia will hold its AGM in Brisbane on November 16. (Rob Finlayson)

Virgin Australia’s two new Chinese shareholders have nominated their representatives for the airline group’s board.

Shareholders will vote on the election of the new directors at Virgin’s annual general meeting in Brisbane on November 16.

HNA has nominated Nang Qi, currently chief innovation officer at the company’s HNA Innovation Group subsidiary, as its representative on the Virgin board.

Meanwhile, Nanshan has put forward Dr Chien-tsung Lu, the vice chairman of its Qingdao Airlines subsidiary, as its nominee.

Virgin’s notice of annual general meeting published on Wednesday said the company’s current directors recommended shareholders vote in favour of the two nominations.

HNA arrived on Virgin’s share register after a $159 million share placement in June that yielded a 13 per cent stake. A further $89 million top up placement and participation in Virgin’s capital raising lifted the shareholding to 19.99 per cent.

Virgin and HNA planned to form a commercial alliance that would lead to the Australian carrier mounting flights to Beijing and Hong Kong with its own aircraft from June 1 2017.

According to its website, as at July 2016 the HNA Group had a fleet of about 1,250 aircraft, operating flights to more than 200 destinations and carrying 77.4 million passengers annually.

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Airlines in the group comprised: Hainan Airlines, Tianjin Airlines, Deer Jet, Lucky Air, Capital Airlines, West Air, Fuzhou Airlines, Urumqi Air, Beibu Gulf Airlines, Yangtze River Airlines, Guilin Airlines, My CARGO, Africa World Airlines, and Aigle Azul.

It also has strategic investments in aircraft leasing (Avalon), cargo, ground handling services (Swissport), hotels and travel agency businesses, and manages 13 airports.

Virgin had a second major Chinese shareholder in June, when Air New Zealand completed the sale of a 19.98 per cent stake in the Australian carrier to Nanshan for $267 million.

Privately-held Nanshan is involved a diverse range of sectors from aluminium, finance, education, clothing and real estate, as well as Qingdao Airlines, which is an Airbus A320 operator based in Shandong Province on China’s east coast that began flying in April 2014.