AIR China and China Southern Airlines have dismissed a media report of a possible merger of the two State-owned carriers, which had caused their share prices to close at their upper limits in Shanghai on Thursday.

    Shanghai Securities News had reported that both airlines were likely to join forces, citing market talk, as the government moves to consolidate State-run conglomerates to improve competitiveness.

    But Air China Ltd., the country’s biggest airline by market value, and China Southern Airlines Co., the largest by fleet size, each said in separate filings Friday that they had no knowledge of such plans.

    Air China said: “Upon inquiry with China National Aviation Holding Company, the controlling shareholder of the company, neither the company nor its controlling shareholder has ever received any information, written or verbal, from any government authority concerning the above mentioned reports.”

    The Civil Aviation Administration of China, the country’s aviation regulator, also said it had no knowledge of such a merger.

    A China Southern executive had earlier said that the company knew nothing about it.

    “We know nothing about it. There had been some market talk on the merger of the cargo business of State carriers earlier, and now comes talk about a merger of Air China and China Southern,” the executive said.

    The government has said it wants to develop innovative, globally competitive conglomerates, capable of exporting Chinese know-how and high-end manufacturing.

    (SD-Agencies)