(Yicai Global) March 27 -- Hong Kong's Cathay Pacific Airways has purchased rivaling low-cost airline Hong Kong Express Airways for HKD4.9 billion (USD624.3 million).

Cathay Pacific will pay HKD2.3 billion in cash and the rest by promissory loan notes, and the transaction is expected be completed by the end of this year, the buyer said in a statement today. 

Cathay Pacific expected to log HKD2.3 billion in profit attributable to shareholders last year. It made a loss of HKD1.3 billion in 2017, caused by errors in fuel hedging and increasingly fierce competition with Chinese airlines. 

With the purchase, Cathay Pacific would uplift its market share to 84 percent in Hong Kong from 76 percent, basically cementing its monopoly, Lin Zhijie, a civil aviation industry insider, told Yicai Global. The acquisition would diversify the parent's product offering to serve different customer groups, Lin added. 

Hong Kong Express' unaudited net loss was HKD141 million (USD18 million) in 2018. Its after-tax profit was HKD60 million in 2017. 

Editor: Emmi Laine