Cathay Pacific (CX, Hong Kong International) has entered into an agreement to repurchase the entire 9.57% stake in the airline held by Qatar Airways (QR, Doha Hamad International) for HKD6.97 billion Hong Kong dollars (USD896 million). The off-market transaction is subject to approval by Cathay Pacific's independent shareholders.

Qatar Airways will sell its 643,076,181 shares back to the Hong Kong carrier at a price of HKD10.8374 (USD1.39) per share. This will alter Cathay Pacific's ownership structure, increasing the stake of Swire Group from 43.12% to 47.69% and that of Air China (CA, Beijing Capital) from 28.74% to 31.78%.

The completion of the share buyback is contingent on the approval of at least three-quarters of the votes cast by independent shareholders at an upcoming extraordinary general meeting. While no completion date has been set, the Deed of Undertaking expires on May 4, 2026, if conditions are not met.

Cathay Pacific said the buyback was prompted by Qatar Airways' decision to dispose of its entire holding and was structured to “achieve an orderly exit” while avoiding market volatility. It said it would fund the transaction through internal resources and existing credit lines.

Following the transaction, the public float of Cathay Pacific's shares will be reduced to approximately 20.53%, which is below the 25% minimum requirement of the Hong Kong Stock Exchange. However, the airline has been granted a waiver from the exchange to permit this.

Qatar Airways said the divestment was part of a "proactive strategy to optimise our investments and position the group for long-term growth," while reaffirming its commitment to partnering Cathay through the Oneworld alliance.

The Qatari state-owned airline first acquired the stake in November 2017 from Kingboard Holdings, becoming Cathay Pacific's third-largest shareholder. It continues to hold stakes in other companies such as Airlink (South Africa), Virgin Australia, IAG International Airlines Group, and LATAM Airlines Group.