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The Qatari carrier announced a $661 million deal on Monday to
buy a 9.61 percent stake in Hong Kong's Cathay Pacific Airways
<0293.HK> to broaden its reach and potentially allow the
oneworld alliance member to increase traffic through its Doha
hub.
"Frankly, I wish I could buy more. But the Swire Group and Air
China hold most of it and I’m the third-largest shareholder,
which is not bad," Qatar Airways Chief Executive Akbar Al Baker
said at the CAPA Asia Summit in Singapore, referring to Cathay's
biggest stakeholders.
Qatar Airways has been unable to fly to the previously lucrative
markets of the United Arab Emirates and Saudi Arabia because of
an airspace rights dispute, prompting investment elsewhere.
Al Baker said the airline expects to report a loss in the
financial year to March 31, 2018, as a result of the blockade.
The airline has acquired 20 percent of British Airways parent
International Consolidated Airlines Group <ICAG.L>, 10 percent
of South America's LATAM Airlines Group <LTM.SN> and 49 percent
of Italy's Meridiana.
Al Baker said that Qatar Airways wants shareholdings to be
exchanged between itself and its portfolio airlines as it seeks
to become a virtual mega-carrier.
"I see a lot of synergies we could bring as a group," he said,
referring to savings to be gained from the envisaged increase in
bargaining power.
"I hope that one day in the not too distant future we all, these
four groups, get together and exchange shareholdings in each
other so that we will become a real mega-carrier. That is
something that some people have tried, but not successfully."
Etihad Airways has pulled back from a strategy of taking
minority stakes in other airlines after struggling European
carriers Alitalia and Air Berlin entered administration.
Association of Asia Pacific Airlines Director General Andrew
Herdman said the history of airlines owning minority stakes in
other carriers is mixed.
"It remains to be seen what influence you can exert as a
minority shareholder," he said during a panel discussion at the
conference.
"You have the added complication that in Cathay Pacific, Air
China is a significant shareholder. And Cathay Pacific is a
significant shareholder in Air China.”
Swire Pacific <0019.HK> is Cathay's biggest shareholder with 45
percent followed by Air China <601111.SS> with 30 percent.
Cathay also owns about 18 percent of Air China.
(Reporting by Jamie Freed; Writing by Miyoung Kim; Editing by
Muralikumar Anantharaman and David Goodman)
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