Business Irish

Wednesday 22 November 2017

Etihad chief 'ready to sit down with Government' about Aer Lingus sale

John Mulligan

John Mulligan

The chief executive of Abu Dhabi airline Etihad, James Hogan, is "ready to sit down" with the Government if it formally puts its Aer Lingus stake up for sale.

Mr Hogan told the Irish Independent yesterday that he and his team at Etihad "have looked" at Aer Lingus, but that no discussions have taken place to date about a possible offer.

"When the Government is ready to sit down, we're happy to sit down and talk to them," he said.

A spokesman at the Department of Transport said there has been "strong interest" in the State's Aer Lingus stake.

"If a decision is made to sell, all expressions of interest will be considered," he said.

A decision on whether the stake will be sold isn't likely to be made for some time, however.

News of Etihad's continuing interest in Aer Lingus sent the Irish airline's shares nearly 7pc higher at one point during yesterday's trading.

Based on the share price, the government's stake is worth about €123m. That's substantially less than its value when Aer Lingus made its stock market debut in 2006.

Mr Hogan, an Australian with Irish heritage, added that it's important in any decision to acquire a stake in an airline that management of that airline are supportive of the move.

He added that while he has met Aer Lingus chief executive Christoph Mueller, their engagements have not extended beyond "chit-chat". He stressed the pair have not touched on the subject of any potential Aer Lingus stake sale as it would be "inappropriate".

The notion of Etihad being a likely candidate for the government's 25.1pc stake in Aer Lingus was first floated last year.

Cooled

However, it subsequently appeared that Etihad had cooled its interest.

The Middle East's third biggest carrier recently agreed to boost its stake in Germany's Air Berlin to nearly 30pc by paying €73m. It also said it would provide the carrier with substantial financial firepower for aircraft purchases. Etihad also recently paid $20m for a 40pc stake in Air Seychelles.

The Middle East airline, which was launched in 2003, has been seeking acquisitions that will help it to grow its traffic. It's also interested in acquiring a stake in Virgin Australia.

Qatar Airways has also been tipped as a potential suitor for the government's Aer Lingus stake.

Etihad yesterday reported its first annual net profit -- of $14m -- and earnings before interest and tax of $137m as revenue last year rose 36pc to $4.1bn.

Mr Hogan said that the airline's service out of Dublin continues to perform very well, despite added competition from rival Emirates, which recently launched a service to Dubai.

Irish Independent

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