by: Simeon Kerr, Financial Times
Qatar Airways is set to start purchasing shares in American Airlines soon despite resistance from the US carrier, the Gulf carrier’s chief executive said on Thursday.
American Airlines has long accused the Doha-based rival of benefiting unfairly from subsidies. Even so, the fast-growing Gulf carrier aims to buy up to 4.75 per cent on the open market “depending on the share price”, Akbar al-Baker said in Dublin.
Qatar Airways last month notified American Airlines that it was interested in acquiring a 10 per cent stake worth at least $808m.
The US carrier told staff at the time it was “puzzled” by the approach, given its “extremely public stance” on what it calls “illegal subsidies” provided to Qatar Airways, as well as its regional rivals Etihad of Abu Dhabi and Emirates of Dubai.
The three state-owned Gulf carriers deny receiving undue help from their state owners.
Mr Baker, who was at the launch of the airline’s Dublin route, said he had made it clear to American that the potential purchase did not represent an attempt to influence the US carrier’s stance towards Gulf airlines.
The comments confirm Qatar’s commitment to a strategy of building minority stakes in other airlines as it looks to drive traffic through its hub at Hamad international airport in Doha. The airline is the biggest shareholder in IAG, which owns British Airways, with a 20 per cent stake.
Etihad, however, is reviewing its strategy of acquiring stakes in other airlines. Concerns about the strategy have grown since Alitalia, in which the Abu Dhabi carrier has a large stake, went into administration.
The timing of Qatar’s latest move comes as the Doha-based airline is caught in the midst of one of the worst crises to hit the oil-rich Gulf region in years.
Saudi Arabia is leading a quartet of Arab states imposing a travel and economic embargo on Qatar, closing airspace to commercial jets flying in and out of Qatar. The airline has had to cut flights to the lucrative markets of Saudi Arabia, the United Arab Emirates, Bahrain and Egypt.
Mr Baker has admitted the embargo is having a negative impact but Qatar, reflecting the mood across the Gulf state, is pressing ahead with expansion plans.
He said any delays to deliveries of A350 long-haul jets were down to Airbus. “We are asking Airbus to deliver it faster,” he added. “The delay is from Airbus.”
Qatar reported a 22 per cent increase in net profit last year, outperforming Emirates and Etihad. Gulf carriers including Qatar are set to benefit from the lifting of a three-month laptop ban on flights to the US from eight Muslim-majority countries.