38.7 C
Doha
Tuesday, May 11, 2021

Qatar Airways ups its stake in BA owner IAG to 20 percent

-

A British Airways Boeing 787 landing at Toronto-Pearson Airport
A British Airways Boeing 787 landing at Toronto-Pearson Airport

Qatar’s national carrier has increased its stake in British Airways owner International Airlines Group (IAG) for at least the fourth time this year.

Qatar Airways now owns 20 percent of the group, double the stake it held at the beginning of 2016.

The airline has been gradually increasing its shares in IAG – which also owns Spanish airline Iberia and Ireland’s Aer Lingus – over the past year.

This most recent purchase raises Qatar Airways’ share of the company by almost five percent compared to their July 2016 holding of 15.67 percent, the airline said in a statement.

Qatar Airways CEO Akbar Al Baker
Qatar Airways CEO Akbar Al Baker

CEO Akbar Al Baker said today that the airline does not intend to increase its stake further in IAG unless there are “material changes to the current situation.”

Although he didn’t elaborate, Al Baker may be referring to the relaxing of foreign ownership rules in the EU, which were suggested by the European Commission last year.

‘Purely financial interest’

Currently, EU competition laws restrict foreign companies to 49 percent ownership when it comes to European airlines.

Despite this, Qatar Airways could still use its large stake to try to influence how IAG is run.

However, the airline today said that its interest in the group was “purely financial.”

An Aer Lingus A330
An Aer Lingus A330

Qatar Airways CEO Akbar Al Baker added that the investment reflected his company’s support for IAG’s business strategy:

“The recent market valuation of one of the world’s leading airline groups has provided what we believe is an attractive opportunity to increase our shareholding in IAG.

We continue to be highly supportive of IAG’s strategy and management team.”

IAG’s shares are particularly attractive at present, as they have dropped significantly in price since the Brexit vote.

The group’s share price has decreased by 23 percent since the UK’s referendum vote to leave the EU in June.

Meridiana deal

BA, Iberia and Aer Lingus are not the only European airlines Qatar Airways has an interest in.

Qatar Airways agreed to a deal to buy Meridiana in July, purchasing 49 percent of the company, the maximum allowable under EU laws.

The Italian carrier previously agreed to slash labor costs by laying off hundreds of workers and cut pilot pay as a concession to Qatar Airways for the purchase.

Thoughts?

Subscribe
Notify of
0 Comments
Inline Feedbacks
View all comments

Related Articles

- Advertisment -

Most Read

Subscribe to Doha News below!

To be updated with all the latest news, offers and special announcements.