Doha-based airline bought shares worth about $496.61 million, after IAG’s lost quarter of its value in Britain post-Brexit
Qatar Airways lifted its stake in British Airways-owner IAG by about 4.34 percent to 20 percent but said on Monday that was its limit, buying shares worth about 375 million pounds ($496.61 million) on what it called an attractive buying opportunity.
Shares in IAG have lost about a quarter of their value since Britain, the airline group's biggest market, voted in June to leave the EU. British companies have also become 10 to 15 percent cheaper for overseas buyers due to the devaluation of the pound since the vote.
State-owned Qatar Airways said it had raised its stake to 20.01 percent from 15.67 percent, sticking to its oft-repeated intention to increase its holding over time. It first invested in the company in January 2015.
"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," Qatar Airways Chief Executive Akbar Al Baker in a statement.
Qatar Airways said it had no plans to increase its shareholding further than the current level unless the situation changed materially. Under current rules, foreign investors cannot own more than 49 percent of a European airline.
Qatar Airways said while its interest was purely financial, the investment reflected the strength of the commercial and strategic ties between the companies.
Al Baker has in the past said the company wanted to tap into IAG's extensive American network through the tie-up.
Qatar Airways has been expanding its global reach in recent months, agreeing in July to acquire up to 10 percent of Chile-based LATAM Airlines and 49 percent of Italian carrier Meridiana.
Qatar Airways said it owned the bigger stake in IAG as of July 28. On July 29, IAG's shares closed down 0.8 percent after it trimmed growth plans for 2016 further and gave a cautious outlook for annual earnings following Britain's vote to leave the EU.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.