Air New Zealand has agreed to sell nearly 20% of its share in Virgin Australia to China’s Nanshan Group for approximately $193m.

Nanshan Group owns Chinese start-up carrier Qingdao Airlines.

The deal is yet to receive approval from Chinese regulators.

Air New Zealand chairman Tony Carter said in a statement: "We believe Nanshan Group will be a very strong, positive and complementary shareholder for Virgin Australia.

"We look forward to meeting with Nanshan Group over the coming weeks to discuss the proposed acquisition."

"The sale will allow Air New Zealand to focus on its own growth opportunities, while still continuing its long-standing alliance with Virgin Australia on the trans-tasman network."

Air New Zealand currently owns a 25.9% stake in Virgin Australia and is mulling over options on the rest of its Virgin Australia shares.

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Singapore Airlines also has a stake in Virgin Australia and received approval from Australia’s Foreign Investment Review Board to increase its stake in the company to 25.9%, reported Atwonline.

UAE-based Etihad Airways also has a 25.1% stake in Virgin Australia.

Virgin Australia said in a statement: "We look forward to meeting with Nanshan Group over the coming weeks to discuss the proposed acquisition."

In May, Chinese conglomerate HNA Group announced that it would buy a 13% stake in Virgin Australia for $114m and prepares to raise its stake to 19.99%.

With the deal, Virgin Australia aims to increase access to the growing Chinese travel market and plans to begin direct flights between Australia and China.