The Luxembourg government has completed the sale of a 35 percent stake in all cargo carrier Cargolux to China’s Henan Civil Aviation Development and Investment for $120 million.
The deal, signed in the Chinese province, includes the development of a “dual hub strategy” for Luxembourg airport with Zhengzhou airport, initially involving four freighter flights per week.
HNCA also is providing $15 million towards Cargolux’s development fund and will contribute up to $61.5 million toward a $175 million capital increase scheduled for the first quarter of 2014.
The Luxembourg government bought the stake from Qatar Airways for $117.5 million in late 2012 after the Middle East carrier exited its investment after less than a year following a row over strategy for Cargolux.
HNCA is now Cargolux’s second largest shareholder after Luxair, Luxembourg’s state-owned airline, which has a 35.01 percent stake.