Joint Announcement

Air China Ld
25 January 2007

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 howsoever arising
from or in reliance upon the whole or any part of the contents of this
announcement.




                               AIR CHINA LIMITED


                    CHINA NATIONAL AVIATION COMPANY LIMITED





                               JOINT ANNOUNCEMENT
                           PROPOSED PRIVATIZATION OF
                    CHINA NATIONAL AVIATION COMPANY LIMITED
                              BY AIR CHINA LIMITED
                       BY WAY OF A SCHEME OF ARRANGEMENT
                  UNDER SECTION 166 OF THE COMPANIES ORDINANCE


                          EFFECTIVE DATE OF THE SCHEME
                                      AND
                             WITHDRAWAL OF LISTING

                                      AND
                    CLOSE OF OFFER UNDER THE OPTION PROPOSAL


          Financial adviser to China National Aviation Company Limited


                     Citigroup Global Markets Asia Limited


        Independent financial adviser to the Independent Board Committee
                   of China National Aviation Company Limited


                      CLSA Equity Capital Markets Limited


               Exclusive financial advisers to Air China Limited



China International Capital Corporation 
          (Hong Kong) Limited              Merrill Lynch (Asia Pacific) Limited



THE SCHEME BECOMES EFFECTIVE

The Scheme was sanctioned and the reduction of the share capital of CNAC
involved in the Scheme was confirmed by the Court on Tuesday, 23 January 2007.
An office copy of the order of the Court with a minute relating to the reduction
of the share capital of CNAC and containing the particulars required by Section
61 of the Companies Ordinance was delivered to the Registrar of Companies in
Hong Kong on Tuesday, 23 January 2007 and the Scheme was effective upon the
registration on Wednesday, 24 January 2007.

WITHDRAWAL OF LISTING

The withdrawal of listing of the Shares on the Main Board of the Stock Exchange
will become effective at 9:30 a.m. on Thursday, 25 January 2007.



INTRODUCTION

Reference is made to the joint announcement dated 23 January 2007 issued by CNAC
and Air China and the scheme document dated 16 November 2006 (the 'Scheme
Document') despatched by CNAC to the Minority Shareholders and Option holders
regarding the proposed privatization of CNAC by Air China by way of a scheme of
arrangement under Section 166 of the Companies Ordinance. Terms defined in the
Scheme Document shall have the same meanings when used in this announcement
unless otherwise stated.

THE SCHEME BECOMES EFFECTIVE

The Scheme was sanctioned and the reduction of the share capital of CNAC
involved in the Scheme was confirmed by the Court on Tuesday, 23 January 2007.
An office copy of the order of the Court with a minute relating to the reduction
of the share capital of CNAC and containing the particulars required by Section
61 of the Companies Ordinance was delivered to the Registrar of Companies in
Hong Kong on Tuesday, 23 January 2007. Upon the registration of the office copy
of the order of the Court with a minute relating to the reduction of the share
capital of CNAC on Wednesday, 24 January 2007, all conditions of the Scheme set
out in the Scheme Document were thereby fulfilled or waived (as appropriate),
and the Scheme was thereupon effective.

WITHDRAWAL OF LISTING

The withdrawal of listing of the Shares on the Main Board of the Stock Exchange
will become effective at 9:30 a.m. on Thursday, 25 January 2007.

CLOSE OF OFFER UNDER THE OPTION PROPOSAL

Reference is made to the letter to Option holders dated 16 November 2006, the
accompanying form of acceptance and the Scheme Document. The Option proposal has
become unconditional upon the Scheme becoming effective. Holders of outstanding
Options are entitled to accept the offer under the Option proposal within 14
days of 24 January 2007, being the effective date of the Scheme, in accordance
with the terms and conditions set out in the letter to Option holders, the share
option scheme of CNAC and the Scheme Document (the 'Terms').

As at the date of this announcement, the holders of outstanding Options are Mr.
Chuang Shih Ping, Mr. Tsang Hing Kwong, Thomas, Mr. Zhang Xianlin and Mr. Gu
Tiefei. Each of Mr. Chuang Shih Ping and Mr. Tsang Hing Kwong, Thomas, together
holding a total of 66,252,000 outstanding Options, has accepted the Option
proposal in accordance with the Terms. Mr. Zhang Xianlin and Mr. Gu Tiefei,
holding respectively 33,126,000 and 5,000,000 outstanding Options, will not
accept any of Air China's proposed offer to acquire his outstanding Options
for cancellation before their expiry pursuant to their respective undertakings
details of which are disclosed in the Scheme Document. As such, the offer under
the Option proposal was closed at 4:00 p.m. on 24 January 2007.


DESPATCH OF CHEQUES FOR PAYMENT OF MONETARY ENTITLEMENTS UNDER THE SCHEME AND
THE OPTION PROPOSAL

In accordance with the terms of the Scheme, the cheques for payment of the
monetary entitlements under the Scheme will be despatched on or before Saturday,
3 February 2007. Pursuant to the terms and conditions set out in the letter to
Option holders and the share option scheme of CNAC, cheques for payment of
monetary entitlements under the Option proposal will be despatched to Mr. Chuang
Shih Ping and Mr. Tsang Hing Kwong, Thomas on or before Saturday, 3 February
2007, being the tenth day of the Effective Date.



By order of the Board                              By order of the Board
 Air China Limited                      China National Aviation Company Limited
Zheng Baoan Li Man Kit                                  Li Man Kit
Joint Company Secretaries                             Company Secretary


Hong Kong, 24 January 2007

The directors of Air China jointly and severally accept full responsibility for
the accuracy of the information contained in this announcement (other than that
relating to the CNAC Group) and confirm, having made all reasonable enquires,
that to the best of their knowledge, opinions expressed in this announcement
(other than those expressed by CNAC) have been arrived at after due and careful
consideration and there are no other facts (other than those relating to the
CNAC Group) not contained in this announcement, the omission of which would make
any statements in this announcement misleading.

As at the date of this announcement, the board of directors of Air China
comprises Li Jiaxiang, Kong Dong, Wang Shixiang, Yao Weiting, Christopher Pratt
as non- executive directors, Ma Xulun, Cai Jianjiang, Fan Cheng as executive
directors, and Hu Hung Lick, Henry, Wu Zhipan, Zhang Ke and Jia Kang as
independent non- executive directors.

The directors of CNAC jointly and severally accept full responsibility for the
accuracy of the information contained in this announcement relating to the CNAC
Group and confirm, having made all reasonable enquires, that to the best of
their knowledge, opinions expressed in this announcement relating to the CNAC
Group have been arrived at after due and careful consideration and there are no
other facts relating to the CNAC Group not contained in this announcement, the
omission of which would make any statements in this announcement relating to the
CNAC Group misleading.

As at the date of this announcement, the board of directors of CNAC comprises
Kong Dong, Chuang Shih Ping, Zhang Xianlin, Zhao Xiaohang, Tsang Hing Kwong,
Thomas, Gu Tiefei as executive directors, Lok Kung Nam, Hu Hung Lick, Henry, Ho
Tsu Kwok, Charles, Li Kwok Heem, John, Chan Ching Har, Eliza as independent
non-executive directors.



'Please also refer to the published version of this announcement in The
Standard.'






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