VIRGIN-HNA ALLIANCE GETS PRELIMINARY APPROVAL

VIRGIN Australia's proposed alliance with HNA Aviation, Hong Kong Airlines and HK Express has been given interim approval by the ACCC.

If the final ruling, due in May or June, is positive, the Brisbane-based airline will commence direct flights between Australia and Hong Kong and Australia and China, which it will codeshare with HNA.

The airlines will also introduce a reciprocal frequent flyer partnership and codeshare on domestic routes.

HNA Group owns 13 per cent of Virgin Australia Holdings as part of a consortium of five international airlines that own more than 80 per cent of the company.

At the time alliance was proposed on 17 February, Virgin Australia Group CEO John Borghetti said the alliance would be a "game changer" for travel between Australia and China.

"The alliance will accelerate and support our access to the Chinese market, which is Australia's fastest growing and most valuable inbound travel market," says Borghetti.

"HNA Aviation fly nearly 100 million passengers each year and we look forward to working collaboratively with them to drive inbound visitation to Australia, resulting in significant benefits for the Australian tourism industry and broader economy.

"Importantly, this strategic alliance with HNA Aviation, Hong Kong Airlines and HK Express is a key plank in Virgin Australia's International strategy and will help our business deliver long-term growth and success."

Virgin Australia is trading up 2.63 per cent at $0.195 per share at 2:21pm AEDT on the ASX this afternoon.

Business News Australia