China Southern Airlines said Tuesday it would issue HK$1.55b (US$199.6m) worth of shares to a subsidiary of American Airlines Group, giving the US airline a stake in China's largest carrier. The deal would make American Airlines the second US carrier to own part of a Chinese airline after Delta bought 3.55% of China Eastern Airlines Corp for $450m in 2015. It also means that China's three biggest airlines now all have tie-ups with foreign airlines, something Beijing has encouraged as a way to boost the sector's global competitiveness. Hong Kong's Cathay Pacific and Chinese flag carrier Air China purchased a stake in each other in 2006. In a filing to the Hong Kong stock exchange, China Southern said it would issue 270.61m Hong Kong-listed H-shares, representing 2.68% of the enlarged share capital of the airline. The shares would be issued at HK$5.74 apiece, or at a 4.6% premium to the previous close. "It makes sense to partner with another foreign airline," said Daiwa Capital Markets analyst Kelvin Lau, citing Air China and China Eastern's deals. "But ... because the stakeholding is pretty small, I don't think it will make any material changes in terms of management."<br/>