CNAC added that it will not accept an unrevised deal, calling for a renegotiation and deal revisions to make it more acceptable to other shareholders.

CEA, however, responded that it would not consider deals other than the one with SIA, adding the offer price is reasonable as it was agreed after long, market-based talks between the carriers.

The response has aroused discontent from many small and medium-sized shareholders, complaining that the airline fails to take into consideration their interests by blocking potential higher price bidding, the China Securities Journal reported Saturday.

CNAHC and Hong Kong-based Cathay Pacific Airways have offered in September to buy rival CEA's H shares at a higher price of HK$4.85 apiece, earlier media reported.

The potential higher-priced offer may help to sway other shareholders away from CEA's tie-up plan. It needs approval of two-thirds of the small and medium-sized H and A shareholders before becoming effective.

The deal, if passed, can offer CEA managerial expertise apart from cash injection, and SIA access to China's rapidly growing aviation market in return.

The market is currently dominated by three state-owned airlines, Air China, China Eastern and China Southern, based in the metropolises of Beijing, Shanghai and Guangzhou, respectively.

Li Jiaxiang, CNAHC general manager and board chairman of Air China, was recently promoted to the head of General Administration of Civil Aviation.

Li has been longing for an alliance with China Eastern to gain more access to Shanghai market, a move to build Air China into a "super carrier" to better vie with foreign rivals for larger market shares.