On Friday, Air China acknowledged that it had a long-term ambition to lift its stake in Cathay Pacific, for a possible takeover of the Hong Kong airline.

As per the report released on Friday, a sum of 6.34 billion Hong Kong dollars (813 million US) was paid this month by the Chinese flag carrier, with the aim to enhance its holdings in Cathay to 29.99 percent, just below the 30 percent threshold that would initiate a mandatory takeover offer.

It was put forth by Air China that it had to convince controlling shareholder, Swire Pacific, to permit it to increase its stake.

This is because the carrier is controlled by an agreement capping its shareholding for three years.

Kong Dong, chairman of the Chinese airline, said: "It is not only up to us but subject to mutual understanding between Cathay and Air China. It will take time. We are quite content with what we've achieved now."

Cathay's move to find bigger partners can be understood by Shanghai's threats to Hong Kong as an aviation hub, subsequent to the merger of China Eastern Airlines Corp and Shanghai Airlines.

Kong said: "Hong Kong is too small, and Cathay needs the support of Beijing to substantially increase its competitiveness in the region."