Sun, Jun 9, 11:46pm by Kevin Pitstock
Chinese businessman Stanley Ho has agreed to a partnership with Qantas in the proposed Jetstar Hong Kong airline. For an investment of $66 million, it’s thought Mr Ho’s Shun Tak Holdings will hold a 33.3% stake in the company.
Jetstar HK is a proposed low airfare company which is expected to open its doors in 2013. Qantas and Chinese East Airlines are in a strategic partnership to build the new low cost flier, with both companies owning 33.3% of the operation.
Each of the airlines has agreed to invest up to $198 million, though that number was reduced to $99 million apiece upon announcement of the Stanley Ho commitment. Jetstar Hong Kong is meant to be the natural successor to Oasis Hong Kong Airlines, which closed for business in April 2008. Over its two years as a carrier, the company had lost $1 billion.
The 91-year old Stanley Ho is one of the richest men in Hong Kong. Because a good percentage of Mr Ho’s wealth came from his 40-year casino monopoly, the Chinese know him by the moniker “The King of Gambling”. His role in Macao makes him one of the wealthiest men in China’s gambling capital, too.
Stanley Ho has engaged in many fields of business, with investments in mainland China, Vietnam, The Philippines, North Korea, East Timor, Mozambique, and Portugal. These days, Shun Tak Holdings is operated by Ho’s daughter, Pansy Ho. In all, the Asian businessman has 17 different children from his four wives.
Mr Ho began his professional life as a clerk in a Japanese-owned import-export business in Macau. During World War II, he smuggled luxury items across Macau’s border into China, which won him his fortune. The profits increased after the war, as he invested in kerosene and construction in post-war Hong Kong, which was growing through a housing boom.
By 1961, Stanley Ho had joined a consortium which included a Hong Kong (Henry Fok), Indonesian businessman (Teddy Yip), and a professional gambler from Macau (Yip Hon, Teddy Yip’s brother-in-law). This group won a bid for Macau’s casino monopoly and helped turn the city into a tourist attraction. Each man became a giant of the gaming industry in China, with Stanley Ho becoming an economic force in Macau and Hong Kong.
Jetstar HK will start business later this year. By 2015, the airline hopes to have a fleet of 18 jet airliners. On June 4th, the Hong Kong Transport and Housing Bureau indicated it would stop processing an application for the airline in order to review its policy of allowing non-local air carriers to file applications for permits for business.
This might explain why, two days later, Stanley Ho’s corporation received a 33% share while investing $66 million (to the other partners’ $99 million investments). It would appear Shun Tak Holdings is keeping the application process moving forward and, in a way, rescuing the project from a major new bureaucratic roadblock. It should be noted Qantas is based out of Sydney and Chinese East Airlines are based out of Shanghai.
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