The China Aviation Development Foundation (CADF) will find it even more difficult to sell 1.7 billion China Airlines (CAL) shares at their net value of NT$18.4 per share in the wake of last Satur-day's crash, a market observer said yesterday.
Referring to Premier Yu Shyi-kun's directive on Wednesday that CAL -- now perhaps the developed world's most dangerous airline -- should be fully privatized within two years, the observer said that the CADF, as the biggest shareholder, has been trying to sell CAL shares over the past four years.
The observer noted that immediately after the last major CAL air crash -- near the CKS International Airport on Feb. 16, 1998, then-Premier Vincent Siew (
The less-than-smooth implementation of the privatization plan bumped into further difficulties when the devastating Sept. 21, 1999 earthquake caused fluctuations in Taiwan's stock market in the following months.
In early 2000, just before the presidential election, then-Minister of Transportation and Communications Lin Feng-cheng (林豐正) was expecting to sell 72 percent of CAL shares at no less than NT$28 per share, according to the observer.
However, the government-controlled CADF was unable to find buyers because the CAL share price was only a little over NT$20 at that time and the CADF was wary of being accused of selling the shares below market value.
The low price has also made officials half-hearted in implementing the privatization plan due to the low market price of the CAL shares, he said.
He pointed out that last Saturday's plane crash dragged the share price to below NT$13 per share, which is far below the net value of NT$18.4 per share.
In the past few days, prices have continued to drop, closing at NT$12.75 per share yesterday, which is 21 percent less than the May 24 closing price of NT$16.3.
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