Friday 19 January 2018

Qatar bids for stake in major US airline

A man stands outside Qatar Airways office in Riyadh, Saudi Arabia. Photo: Reuters
A man stands outside Qatar Airways office in Riyadh, Saudi Arabia. Photo: Reuters

Michael Sasso

Only weeks after President Donald Trump accused Qatar of funding terrorism, the nation's flagship airline has made a surprise overture to acquire a major stake in American Airlines.

The move, disclosed yesterday by American, represents a startling turn in a running battle between US carriers and their Persian Gulf rivals, which US airline executives say have unfair advantages because of deep government subsidies. It also comes against the backdrop of renewed efforts by the Trump administration to mediate the simmering crisis between Qatar and the US's closest regional allies, notably Saudi Arabia.

Qatar Airways is seeking to acquire about 10pc of American, a stake that would put the state-owned company on par with Warren Buffett's Berkshire Hathaway among shareholders of the world's largest carrier. That would require approval by American's board - a step that is by no means guaranteed given American's vocal efforts to level the playing field in global aviation under so-called Open Skies agreements designed to promote fair competition.

Texas-based American Airlines said in a stock market filing that it believes the US government will continue to defend against "massive carrier subsidies that threaten the US aviation industry and that threaten American jobs". The company declined to comment beyond the filing. Qatar Airways didn't immediately respond to a request for comment. Shares in American rose 3.5pc to $50.14 in New York after climbing as much as 4.4pc for the biggest intraday gain in six weeks, on the news. (Bloomberg)

Irish Independent

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