The Red Era: Living in Seclusion in a Siheyuan as a Boss

Chapter 637 Aviation Giant!!!

The strategic alliance between "Liu Overseas" and the Bao family and the Li family is becoming increasingly close, and the three parties have formed an unbreakable business iron triangle.

As the cooperation deepened, this powerful alliance began to absorb more influential H-funded consortiums, gradually expanded its business territory, and gradually penetrated and eroded the Y-funded system.

In this all-round business competition, Hong Kong's economic landscape is undergoing profound changes.

Emerging capital forces represented by H-capital such as "Liu's Overseas Investment" are gradually gaining dominance in various industries.

The most typical examples are the two lifelines of Hong Kong's foreign trade: aviation transportation and ocean shipping.

These strategic industries not only serve as a bridge connecting Hong Kong with the world, but also become the main battlefield for capital competition. Changes in their ownership have a profound impact on the economic lifeline and development direction of this international metropolis.

Hong Kong is one of the most important international airports in Xia Country, but in the past the aviation market was almost monopolized by Cathay Pacific Airways, with more than 8% of the market share in the hands of this company.

Many people think that Cathay Pacific is a Hong Kong company, but this is not the case at all.

The earliest controlling shareholder behind this company was the Y-capital consortium Swire Group.

Although the headquarters of the Swire Group has always been located in Hong Kong, it is actually a typical private-funded conglomerate.

More than a hundred years ago, this Y country consortium came to Xia country to develop, and later became one of the four most famous trading companies in Hong Kong.

Today, Swire Group is also one of the world's top 500 companies, with businesses covering real estate, aviation, beverages, finance and other fields, and its scale is very large.

In fact, more than a decade ago, knowledgeable people such as Liu Shudong, Bao Yugang and Li Jiacheng already knew the importance of taking back the aviation industry.

Aviation is a basic industry for a region and has a huge impact.

However, Hong Kong's aviation industry has long been controlled by Y-capital consortium, which is not a good thing.

Therefore, after the two parties formally negotiated and signed the contract, the situation was already decided.

These H-capital began to take action, among whom the representatives were Cao Guangbiao and Pao Yue-kong.

At that time, many H-funded companies took action and began to acquire Y-funded companies to ensure a smooth economic transition before and after Hong Kong's return.

For example, "Liu's Overseas Investment" first acquired the Hong Kong Electric Company alone, and then assisted Li Zhaoji in acquiring the China Gas Company, and Bao Yugang in acquiring the Wheelock Company, and so on.

Liu Shudong, on behalf of "Liu's Overseas", formed an alliance with textile tycoon Cao Guangbiao and joined forces with Bao Yugang to establish Hong Kong Dragon Airlines, attempting to compete with Cathay Pacific and break the other party's monopoly.

It can be said that Cao Guangbiao is also a very patriotic entrepreneur. He began to invest and build in the mainland in the 70s to promote the economic development of the mainland. At the same time, he also made many charitable donations in the mainland.

Yongxin Optics, which was later founded by Cao Guangbiao's family, produced many high-end optical instruments, which were also widely used in Xia's future aviation industry.

Although Liu Shudong and others founded "Hong Kong Dragon Airlines", it is still far behind "Cathay Pacific Airways" which dominates Hong Kong. Hong Kong people still prefer "Cathay Pacific Airways" when traveling.

Cathay Pacific, the pride of Hong Kong, has unified the aviation industry in Hong Kong since it acquired Hong Kong Airlines and has become the world's sixth largest aviation giant.

The founding story of Cathay Pacific Airways is very special. It was not originally established for commercial purposes but to transport supplies.

In 1946, a "Sam" pilot named Roy Farrell and a "Kangaroo Country" pilot named Sydney de Kantzow formed a transport team to transport supplies from Kangaroo Country to Xia Country.

Later, when they left Shanghai and went to Hong Kong to continue their careers, Farrell and others began to name the new company.

They gathered at a hotel in Manila to discuss the matter.

Everyone agreed that names like "Air Hong Kong" and "Hong Kong Airlines" were too common and lacked distinctiveness.

Farrell personally has a soft spot for the word "Cathay".

This term originated from the ancient name of the Xia Kingdom given by medieval Europeans, meaning "Khitan", which contains a romantic and classical charm.

It reminds foreigners of legendary stories such as "Marco Polo", "Genghis Khan", "Silk Road" and "Shangri-La".

Therefore, it seemed natural to name the company "Air Cathay".

However, Farrell and de Kanztow's vision goes far beyond this.

They had a dream that one day they would be able to cross the Pacific Ocean and connect with the American market.

Based on this vision, they finally decided to name the company "Cathay Pacific Airways".

The new name was officially registered in Hong Kong on September 1946, 9.

It is worth mentioning that the word "Cathay" is also highly respected in the mainland of Xia.

There are rumors that this is related to the Russians in the neighboring country of Xia.

In Russian, "Cathay" is pronounced "Kitai", which is similar to the pronunciation of "Cathay".

Therefore, "Cathay Pacific" was simplified in the 50s to the "Cathay Pacific Airways" we know today.

Initially, Cathay Pacific operated with only two DC-47 aircraft converted from C-3 transport aircraft.

Provide passenger and cargo charter services to and from Manila, Bangkok, Lisbon and Shanghai.

After Cathay Pacific was established, its passenger volume reached more than 3 in the first year.

Note that this was the forties!

A year later, Cathay Pacific's fleet was further expanded with the addition of three DC-3 passenger aircraft and a Vickers Catalina seaplane.

Cathay Pacific's fleet was further expanded with the addition of the Douglas DC-4 Skymaster aircraft.

It was in this year that the Y-investment consortium was optimistic about the future prospects of Cathay Pacific Airways.

At that time, Butterfield & Swire (which later developed into the Swire Group) purchased 45% of Cathay Pacific's shares. At that time, Cathay Pacific was still a joint venture between Australia and the United States.

From then on, the airline used Hong Kong International Airport as its hub. It was not only the first airline to provide civil aviation services in Hong Kong, but also an important member of the Swire Group and the Oneworld Alliance.

With the support of the Hong Kong Y government, the routes south of Hong Kong were assigned to Cathay Pacific, while the routes north of Hong Kong were handed over to its local competitor Hong Kong Airlines.

It was not until 1958 that Cathay Pacific expanded further and acquired Hong Kong Airlines, thereby dominating the local aviation market and entering the Northeast Asian market.

Cathay Pacific took over many routes of the former Hong Kong Airlines, including routes to City T, Tokyo, Seoul and the Maple Leaf Country.

In the following 80s, Cathay Pacific focused on expanding its international route network.

At that time, the Hong Kong government implemented an aviation policy that stipulated that each route could only be operated by one airline.

The first airline to be licensed by the Air Transport Licensing Authority will have exclusive operating rights to that destination.

This policy brought significant advantages to Cathay Pacific and effectively reduced the threat from its later major competitor, Dragonair.

At this time, Cathay Pacific Airways had become an aviation giant that monopolized Hong Kong. The Swire Group held a 70% stake, while the remaining 30% was held by HSBC.

In April 1986, Cathay Pacific Airways was listed on the Hong Kong Stock Exchange, which provided the opportunity for "Liu's overseas investment".

Its initial public offering was oversubscribed 56 times and was officially listed on May 5.

At the same time, the establishment of Dragonair is also attempting to break Cathay Pacific's monopoly in Hong Kong's aviation industry.

Although Liu Shudong co-founded "Hong Kong Dragon Airlines" with Bao Yugang and others, he has also been actively acquiring "Cathay Pacific shares" over the years.

He thought that "we have to do both, and both hands must be strong."

So in February 1987, Swire Group and HSBC sold their 2% ​​stake in Cathay Pacific to Liu Overseas Investment for HK$23 billion.

After this transaction, "Liu Overseas Investment" became the third largest shareholder of Cathay Pacific, and several senior executives of "Liu Overseas Investment" joined Cathay Pacific's board of directors.

On January 1990, 1, "Liu Family Overseas Investment" further increased its shareholding in Cathay Pacific to 17% and obtained management rights of Cathay Pacific.

This change undoubtedly further enhanced the influence of "Liu Overseas Investment" in Cathay Pacific.

Subsequently, in March 1994, Cathay Pacific acquired a 3% stake in Hong Kong-based Air China for HK$2 million.

Cathay Pacific Airways was previously operated by the Shun Tak Group. This acquisition will undoubtedly further expand Cathay Pacific's business scope.

In the same year, Cathay Pacific also completely updated its corporate image, replacing the original green and white stripes on the fuselage with a wing logo, a change that undoubtedly enhanced its brand recognition. Today, the equity structure of "Cathay Pacific" has changed significantly, with the largest shareholder becoming "Liu Overseas Investment".

The equity held by "Liu's Overseas Investment" has risen to 40%.

The second and third largest shareholders of Cathay Pacific Airways are Swire Group and Cathay International Airlines Group respectively.

The two companies hold 25.5% and 10.16% of the shares respectively, and the total of the two is 35.16%, which is still 5% less than "Liu's Overseas Investment".

This has no impact on the controlling position of "Liu's Overseas Investment" at all.

Because the Hong Kong government is planning to close Kai Tak Airport, Cathay Pacific's aviation operations will also be relocated to Hong Kong International Airport in Chek Lap Kok.

At the same time, Cathay Pacific will relocate its headquarters to Cathay City on the new airport side in Tung Chung, and plans to invest US$6.25 million in related construction.

Before the Mid-Autumn Festival this year, Cathay Pacific further announced that it had reached an agreement with other related companies and planned to fully acquire Dragonair by means of HK$82 billion and issuing new shares.

At the same time, Cathay Pacific will use 40 billion yuan to increase its stake in Cathay Pacific International Airlines to 7%.

In addition, Cathay Pacific International Airlines also purchased 53% of Cathay Pacific's shares for 9 billion yuan, thus forming a mutual control relationship between the two parties.

The two parties also agreed upon corresponding equity holding restrictions and agreement terms.

Cathay Pacific's shareholders have reached a consensus that any shareholder holding 15% or more of the shares may not make a takeover offer to Cathay Pacific or accept a takeover offer from a third party without the advice of the Cathay Pacific board of directors.

In addition, the composition of the board of directors was adjusted, increasing the number of non-executive directors from three to four, and maintaining the five executive directors nominated by "Liu Overseas Investment".

After the acquisition is completed, the shareholding ratio of each shareholder will become: "Liu Overseas Investment" holds 43% of the shares, "Xia Guo International Airlines" holds 17.5%, Swire Group holds 10.16% of the shares, and Xia Airlines Xingye holds 7.34% of the shares.

Cathay Pacific reached a milestone at the end of August when it welcomed its 8th aircraft – Airbus Cathay Pacific’s first aircraft, Betsy.

The A330 aircraft was then exhibited at the Hong Kong Science Museum.

In early September, Cathay Pacific officially completed the acquisition of Dragonair, thus officially becoming the largest airline in Asia and replacing Japan Airlines.

Cathay Pacific has achieved many successes in aviation history.

On July 1980, 7, they took the lead in launching flights from Hong Kong to London, initially operating three flights per week with a stopover in Bahrain.

By 1981, the route had been increased to a daily flight.

In 1982, the Auckland route was opened.

In 1983, flights to Vancouver were launched, and a route to Frankfurt was opened.

In 1986, Rome, Amsterdam, Paris and San Francisco were added to the route network.

In 1988, he joined Zurich.

In 1992,…

In 1995,…

Cathay Pacific's passenger numbers have grown from 1973 million in 100 to 1800 million last year, and cargo traffic has also grown rapidly.

What is more worth mentioning is that on July 1983, 7, Cathay Pacific launched the world's first non-stop direct flight service from Hong Kong to London. This feat left a significant mark in aviation history.

Since then, Cathay Pacific has continuously strengthened its services on the London route.

In June 1990, they increased the number of flights to two per day and further increased it to three in August last year.

Moreover, with the support of its major shareholder "Liu Overseas Investment", Cathay Pacific is planning to increase the number of daily flights to four after the official opening of Hong Kong International Airport in Chek Lap Kok, further consolidating its leading position in the international aviation market.

Cathay Pacific Airways is working hard to expand its routes and fleet while continuously improving its services.

In 1992, Cathay Pacific was the first airline to install personal televisions on the seatbacks of first-class passengers to provide entertainment services.

It was extended to business class in 1994, and this year, all passengers can watch in-flight entertainment programs on their personal TVs on the seatbacks.

This pioneering initiative allows passengers to choose from six channels in four languages: English, Cantonese, Mandarin and Japanese, to watch a variety of movies, magazine-style documentaries and video programs.

With the vigorous development of the global aviation industry, improving the quality of aviation services has become the key to competition among major airlines.

Since the 1990s, under the control of "Liu Overseas Investment", Cathay Pacific has been committed to continuing to strengthen its talent team building and provide solid talent guarantee for the company's long-term development.

By continuously innovating service models and improving service quality, we provide passengers with a more comfortable and convenient flight experience.

Last year, Cathay Pacific launched the recruitment of flight attendants in the Mainland for the first time as part of its comprehensive recruitment plan, aiming to attract more outstanding young people from the Mainland to join its service team.

The first batch of more than 100 mainland flight attendants stood out. They completed a seven-week training and assessment in Hong Kong, which included emergency and safety training, technical and service skills training, etc.

This move marks a solid step forward for Cathay Pacific in improving service quality and enhancing team diversity.

During the training period, these mainland flight attendants not only learned the necessary aviation service skills, but also gained an in-depth understanding of Hong Kong's culture and working methods, and were fully prepared to provide high-quality services on international and domestic routes.

Their joining will further enrich Cathay Pacific's service team and provide passengers with more considerate and professional services.

Mr. Liu Shudong, representative of Cathay Pacific Airways' major shareholder, said that recruiting mainland flight attendants is one of the company's important measures to improve services and enhance team diversity.

As the use of Mandarin on international flights continues to increase, flight attendants who are fluent in Mandarin, English and other languages ​​will become more competitive.

Cathay Pacific's team already brings together employees from more than 70 nationalities around the world, spanning different ages, religious beliefs, genders and professional fields, bringing a wealth of diverse perspectives and experiences to the company.

This diversified team structure not only helps to improve service quality, but also promotes communication and integration between different cultures, injecting new vitality into the company's long-term development.

In the future, Cathay Pacific will further increase its recruitment efforts in the Mainland, with the goal of recruiting approximately 1500 more flight attendants from the Mainland after .

By then, the mainland will become Cathay Pacific's second largest source of flight attendants after Hong Kong.

This move will not only provide more employment opportunities for young people from the mainland, but will also further promote talent exchange and cooperation between the mainland and Hong Kong, and promote diversified integration and communication between the two places.

In addition to enhancing team diversity and improving service quality, Cathay Pacific also actively advocates a harmonious and inclusive corporate culture.

The company focuses on protecting the rights and interests of employees, commending colleagues who help Cathay Pacific continue to achieve outstanding results, and strives to become one of the most dynamic employers in the world.

This kind of corporate culture not only helps to enhance employees' sense of belonging and cohesion, but also provides a strong internal driving force for the company's development.

In the future, Cathay Pacific will continue to strengthen the ties between Hong Kong, the Mainland and the rest of the world, and give full play to its unique positioning and advantages of being "rooted in Hong Kong, backed by the motherland, and connected to the world."

By expanding its mainland flight attendant team, improving service quality and promoting team diversity, Cathay Pacific will continue to enhance its brand image and market competitiveness and provide passengers with better and more diversified aviation services.

……

Liu Shudong, who had just returned home to celebrate the Mid-Autumn Festival, received good news.

Last Monday, at the Fairmont Windsor Park near London Heathrow Airport, Skytrax, an international air transport rating organization from Country Y, announced:

After the acquisition and reorganization, Cathay Pacific Airways rose to the 4th place in the world in the "World's Best Airline" ranking in this year's Skytrax World Airline Awards.

It surpassed the fifth-ranked "Wakoku Airlines" and the sixth-ranked "Lijiaopo Airlines" in one fell swoop.

It ranks second in Asia, just behind Qatar Airways which ranks third.

Skytrax World Airline Awards: This is a well-known aviation award that selects the best airlines in the world every year.

Winners typically excel in areas such as passenger reviews, service quality and facilities.

This award is known as the "Oscar of the commercial aviation industry" and can be said to be a very authoritative award in the aviation field.

As soon as this good news was released, the Hong Kong stock market became completely popular.

After the reorganization, the market value of Cathay Pacific Airways reached HK$850 billion, an increase of 23.5%.

"Liu Overseas Investment" holds up to 43% of the shares, worth 365 billion Hong Kong dollars, which is a huge profit.

(End of this chapter)