Hafei Rises to Six-Month High on Airbus Composite-Parts Venture
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By Irene Shen
Feb. 2 (Bloomberg) -- Hafei Aviation Industry Co., China’s second-largest listed aerospace company, jumped to the highest in almost six months in Shanghai trading after forming a venture to supply composite-material components to Airbus SAS.
Hafei rose by the 10 percent daily limit to 14.80 yuan at 10:22 a.m. The company owns a stake in Harbin Hafei Airbus Composite Manufacturing Center Co., which will make parts for Airbus A350s and A320s, the planemaker said in a Jan. 30 e- mailed statement.
Airbus plans to give 5 percent of the work making parts for A350 airframes to Chinese companies in a bid to win market share in the world’s second-biggest aviation market. The planemaker has also opened an aircraft assembly line in China, its first outside of Europe.
Harbin Hafei will start production in September, and it plans to open a new plant by the end of 2010, Airbus said. Hafei, Avichina Industry & Technology Co. and Harbin Development Zone Heli Infrastructure Development Co. will each hold 10 percent of the venture. Harbin Aircraft Industry Group Co. will own a 50 percent stake. Airbus will have a 20 percent stake.
AviChina halted its shares in Hong Kong today pending a price-sensitive announcement about a connected transaction, it said in a stock exchange statement. Harbin Aircraft and Harbin Development Heli Infrastructure are all closely held.
Carbon-fiber composites are about four times stronger than aluminum, the traditional material in airplane structures, and weigh 40 percent less. Airbus and Boeing rely on composites to design fuel-efficient planes.
To contact the reporter on this story: Irene Shen in Shanghai Ishen4@bloomberg.net