(ChinaKnowledge, Sept 29, 2006) Cathay Pacific Airways Ltd. announced Thursday that its billion dollar takeover of Dragonair is now completed and that 191 jobs have been cut.

The restructuring measures will see 174 staff or 5% of Dragonair¡¯s 3,847-strong workforce being laid off. Most of the affected employees are office-based workers in various departments at Dragonair¡¯s Hong Kong offices, while 17 employees were based in overseas offices.

Cathay Pacific said job losses had been minimized and that affected staff will be compensated with a package well beyond the legal requirements.

Internal transfers will also take place, with a number of Dragonair staff being transferred to Cathay, and 46 posts created resulting from lifting a recent recruitment freeze at Cathay Pacific. The airline also clarified that no jobs at Cathay Pacific will be cut.

In June, Cathay Pacific agreed to buyout all the rest of the other Dragonair shareholders namely Cathay, Air China, its unit China National Aviation Company (CNAC), Citic Pacific and Swire Pacific. The conclusion of the takeover was a complex process as Cathay Pacific had to gain the necessary approvals from all its shareholders and authorities.

The deal will see Dragonair become a wholly-owned subsidiary of Cathay Pacific, a long-held objective for accessing the Chinese market. On Dec. 1, daily passenger flights to Shanghai will begin with an Airbus A330-340, resuming services after a 16-year absence. This passenger service is in addition to the 16 passenger flights a week by Dragonair and 12 freight flights a week by Cathay Pacific.

Accounting for 35% of the passenger market, and 68% of cargo between Hong Kong and the Mainland, Shanghai will be an important market for Cathay, according to a company statement.
source:ChinaKnowledge