The recession hit Hong Kong's dominant carrier- Cathay Pacific Airways has announced to sell 12.45% stake in Hong Kong Aircraft Engineering Co. to its parent Swire Pacific Ltd in a bid to raise 245 million. Cathay, having 27.45 per cent shares in the air maintenance company, would left with just 15 per cent stakes in the firm post transaction.

Chief Executive Tony Tyler said, "Cash preservation has remained Cathay Pacific's top priority during this downturn, and over the past year we have already taken many measures to help us achieve this goal."

The move will help the cash strapped carrier to fund its capital requirement for purchasing new aircrafts. The transaction will also help to reduce company's net debt to equity ratio from 81 per cent to 76 percent. Huge fuel-hedging gain has already returned it to profit for the first half of current financial year.

The deal will be booked in the current financial year and the airline is expected to gain HK$1.27 billion after completing the deal. Tyler said, "This is a positive move as fundraising needs for the company will decrease after this HK$2 billion deal."

Shares of Cathay, gained 41 declined 4 percent this year, at HK$12.36 on Wednesday.