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Xi'an Aircraft Forms JVs With Avic I Siblings

From Aviationweek.com 2007 August

Xi'an Aircraft Forms JVs With Avic I Siblings

Aviationweek.com, Aug 31, 2007

The reorganization of the Chinese civil aviation industry continues apace, with listed Xi'an Aircraft International Corp. completing the previously flagged formation of two joint ventures with siblings in the Avic I aerospace conglomerate.

The new joint businesses are intended to absorb private capital, rather than rely on traditional state military funding, says Avic I General Manager Lin Zuoming. Xi'an Aircraft International, which is taking over the civil operations of the traditional state-owned company Xi'an Aircraft Group Co., will presumably be the conduit for that private capital.

One joint venture has been formed between the Xi'an firm and Shenyang Aircraft Corp., itself an unlisted part of Avic I based in the northeastern city Shenyang. The other is with Chengdu Aircraft Industrial Co. Ltd., based in the southwestern city Chengdu and also part of Avic I.

As usual, the new businesses will have long and bureaucratic names defining their place in the labyrinth of the Chinese aerospace industry: Avic I Shenyang Civil Aircraft Co. Ltd., and Avic I Chengdu Civil Aircraft Co. Ltd.

In each case, Xi'an Aircraft International will have 45% ownership, the local aerospace parent firm will have 40% and a special investment unit of Avic I will have the remaining 15%.

Avic I's Xi'an, Shenyang and Chengdu businesses all make civil aircraft parts.

© 2009 McGraw-Hill Companies, Inc. (The)

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