The Luxembourg government has agreed to sell a 35 percent stake in Cargolux to Chinese investors for $120 million.
Henan Civil Aviation Development and Investment Co. (HNCA) will also take part in a capital increase for the all-cargo airline of up to $61.25 million and contribute $15 million to a development fund.
Luxembourg acquired the stake from Qatar Airways in late 2012 for $117.5 million when the Middle Eastern carrier exited its investment after less than a year following disagreements over strategy.
The government expects the deal, which still requires approval from Chinese regulators, to close by March at the latest.
HNCA will become Cargolux’s second largest shareholder after Luxair, Luxembourg’s state-owned airline, which has a 35.01 percent stake.