(Yicai Global) Dec. 22 -- The air cargo company set up by China Southern Airlines last month has brought on board eight strategic investors, including one of the country’s largest logistics firms Sinotrans, to diversify its shareholders and bring in fresh financing.

Together they will pay CNY3.4 billion (USD519.4 million) for a 45 percent stake in China Southern Cargo, the Guangzhou-based carrier said today. After the transaction is complete, China’s top carrier by passenger volume will be left with 55 percent equity.

Beijing-based Sinotrans will own 3 percent, CICC Pucheng Investment, an import-export investment agent, will hold 0.6 percent, an employee stock ownership plan will own 4.5 percent and the rest will be held by five private equity investment firms.

The move is part of a general drive towards mixed-ownership reform, which refers to the injection of private capital into state-owned companies to boost competitiveness. It can help to align business synergy and resource integration with the investors, and to put more market-oriented mechanism in place, such as employee feedback and incentives.

The logistics arms of all of China’s top three airlines have brought in external investors in recent years. Eastern Air Logistics under China Eastern Airlines lured in tech giant Lenovo among others in 2017, while the air freight arm under Air China is currently in negotiations with investors.

China Southern [SHA:600029] closed down 3.46 percent at CNY5.86 (USD0.90) today.

Editor: Kim Taylor