Fri, March 27, 2009
Business > Industries

China's private airline faces bankruptcy amid huge losses

2009-03-27 07:58:17 GMT2009-03-27 15:58:17 (Beijing Time)  Xinhua English

WUHAN, March 27 (Xinhua) -- Six creditors have sent applications for the bankruptcy of East Star, one of China's private airlines, to the Intermediate People's Court in Wuhan City, capital of Hubei Province.

Authoritative sources said Friday East Star will most likely go bankrupt as it faces huge losses and cannot handle the current difficulties itself.

East Star has had losses of about 500 million yuan (about 73 million U.S. dollars), according to auditors. It suspended operation on March 15.

WUHAN, March 15 (Xinhua) -- East Star, one of China's private airlines, was ordered to suspend flights as of Sunday because of prolonged financial and management problems, said the local government.

The order was issued by the General Administration of Civil Aviation of China (CAAC)'s branch in charge of the country's central and southern areas at midnight after the government of Wuhan City, capital of Hubei Province, submitted an application Saturday afternoon for the suspension, the municipal government said in a statement.

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