Approval of A Share Issue

Air China Ld
31 July 2006


The Stock Exchange of Hong Kong Limited takes no responsibility for the
contents of this announcement, makes no representation as to its accuracy or
completeness and expressly disclaims any liability whatsoever for any loss
whatsoever arising from or in reliance upon the whole or any part of the
contents of this announcement.
 

 
 
                             AIR CHINA LIMITED 
   (a joint stock limited company incorporated in the People's Republic of
                      China with limited liability)
                           (Stock Code: 753) 
 
 
                (1) CSRC Approval of A Share Issue 
       (2) Commencement of Price Consultation for A Share Issue 
 
 
SUMMARY 
 
 
The CSRC has on 28 July 2006 approved the application of the Company to
proceed with the A Share Issue. The A Share Issue will comprise the
allotment and issue of not more than 2.7 billion A Shares.
 
As required by the relevant PRC regulations, the Sponsors for the A Share
Issue will conduct preliminary price consultation among 67 institutions
recognized by the Securities Association of China from 31
July 2006 to 2 August 2006 in the PRC.
 
 
The A Share Prospectus will be published on the website of the Shanghai
Stock Exchange on 31 July2006 and a summary of the A Share Prospectus will
be published in several PRC newspapers on the same day.
 
 
Reference is made to the announcement of the Company dated 24 July 2006 in
respect of the Company's proposed A Share Issue.
 
The CSRC has on 28 July 2006 approved the application of the Company to
proceed with the A Share Issue. The A Share Issue will comprise the
allotment and issue of not more than 2.7 billion A Shares to institutional
and public investors in the PRC.
 
As required by the relevant PRC regulations, the Sponsors for the A Share
Issue will conduct preliminary price consultation among the 67 institutions
recognized by the Securities Association of China from 31 July 2006 to 2
August 2006 in the PRC. The Company and the Sponsors will determine the
exact number of A Shares to be issued and the offer price in accordance with
indicative demand for the A Shares and the Company's funding needs. The
Company will issue an announcement once the final A Share Issue size and the
offer price have been determined.
 
CNAHC, the controlling shareholder of the Company, has undertaken that upon
the listing and trading of A Shares that were issued and subscribed by cash
at a fixed price online on Shanghai Stock Exchange and up to 31 December 
2006, CNAHC will, subject to the market price of A Shares falling below the 
issue price, increase its shareholding by acquiring shares through the secondary 
market at a price not lower than the then market price of A Shares in accordance 
with relevant regulatory requirements so as to restore the price of A Shares to 
the issue price and the accumulated increase in shareholding of CNAHC will not 
exceed 600 million A Shares.
 
The A Share Prospectus will be published on the website of the Shanghai
Stock Exchange (http:// www.sse.com.cn) on 31 July 2006 and a summary of the
A Share Prospectus will be published in several PRC newspapers including the
China Securities Journal, Shanghai Securities News and Securities Times and
Securities Daily on the same day.
 
 
DEFINITIONS 
 
In this announcement, unless the context otherwise requires, the following
terms shall have the following meanings:
 
'A Shares'     the Domestic Shares which are proposed to be allotted and
               issued by the Company to qualified institutional investors as 
               approved by CSRC and investors including domestic individuals, 
               legal persons and etc. who have opened accounts at the Shanghai 
               Stock Exchange (except those prohibited from subscribing for the 
               shares by the applicable laws and regulations at the time of the 
               A Shares Issue) and listed on the Shanghai Stock Exchange
 
'A Share       the proposed issue of not more than 2.7 billion A Shares
Issue'         by Company to qualified institutional investors as approved by 
               CSRC and investors including domestic individuals, legal persons 
               and etc. who have opened accounts at the Shanghai Stock Exchange 
               (except those prohibited from subscribing for the shares by the 
               applicable laws and regulations at the time of the A Shares 
               Issue), which are proposed to be listed on the Shanghai
               Stock Exchange
 
 
'A Share       the prospectus to be issued by the Company in relation to the 
Prospectus'    A Share Issue
               
 
'CNAHC'        China National Aviation Holding Company, a company incorporated
               under the laws of the People's Republic of China which currently 
               directly owns approximately 51.16% of the Company's share capital 
               as at the date of this announcement
 
'Company'      Air China Limited, a company incorporated in the People's
               Republic of China with primary listing on The Stock Exchange of 
               Hong Kong Limited and secondary listing on the Official List of 
               the UK Listing Authority
 
'CSRC'         China Securities Regulatory Commission
 
'Director(s)'  the director(s) of the Company
 
'Sponsors'     CITIC Securities Company Limited, China Galaxy Securities
               Company Limited, China International Capital Corporation Limited

'PRC'          the People's Republic of China, excluding, for the purpose of 
               this circular only, Hong Kong, Macau and Taiwan
 
 
'RMB'          Renminbi, the lawful currency of the PRC
 
 
                                                By order of the Board
                                                   Air China Limited 
                                               Zheng Baoan     Li Man Kit 
                                              Joint Company Secretaries
 
 
Beijing, 31 July 2006
 
As at the date of this announcement, the Directors of the Company are Messrs
Li Jiaxiang, Kong Dong, Wang Shixiang, Yao Weiting, Christopher Dale Pratt,
Ma Xulun, Cai Jianjiang, Fan Cheng, Hu Hung Lick, Henry*, Wu Zhipan*, Zhang
Ke* and Jia Kang*.
 
 
*     Independent non-executive Director of the Company
 
 
'Please also refer to the published version of this announcement in the
South China Morning Post'
 


                      This information is provided by RNS
            The company news service from the London Stock Exchange