Font Size

- Aa +

Thu 19 Jul 2012 11:17 AM

Font Size

- Aa +

Etihad gets nod to up Virgin Australia stake to 10%

Australian government gives Abu Dhabi carrier clearance to raise stake from current 4.99%

Etihad gets nod to up Virgin Australia stake to 10%
Abu Dhabis Etihad Airways has been given the green light by the Australian government to increase its stake in Virgin Australia to 10 percent.

Abu Dhabi's Etihad Airways has been given the green light by the Australian government to increase its stake in Virgin Australia to 10 percent, it was announced Thursday, a month after upping its shareholding in the carrier to 4.99 percent.

The airline, which has already bought stakes in three other carriers as it looks to compete with Gulf rivals, said it had received permission from the Foreign Investment Review Board to raise the level of investment.

The strategic partnership “will lead to further revenue generating opportunities”, Etihad said in a statement.

Virgin Atlantic is part owned by British billionaire Richard Branson and Air New Zealand.

Etihad is making acquisitions in a bid to compete with larger rivals Qatar Airways and Emirates Airline, which are increasingly challenging European, Asian and Australian carriers on long-haul routes.

The Abu Dhabi carrier in December raised its stake in airberlin, Europe’s sixth-largest airline, from 2.9 percent to 29.2 percent for US$95m. In May, it acquired a three percent stake in the Irish no-frills carrier Aer Lingus and in January bought a 40 percent stake in Air Seychelles.

Etihad in April said first quarter revenues increased 28 percent year-on-year to US$989m on the back of increased passengers, setting it on target to achieve a second year of profitability.

“[It’s] a good start to the year. There are always challenges but certainly I am bullish about the way forward and very focused that we’ll achieve profitability again this year,” said chief executive James Hogan.

“We’re certainly looking at being a US$5bn business this year, last year was just over US$4bn,” he added.

For all the latest transport news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.