Monday 10 December 2018

Qatar swoops on Cathay Pacific

Passenger planes of Cathay Pacific Airways park at the Hong Kong Airport terminal in Hong Kong. Photo: Reuters
Passenger planes of Cathay Pacific Airways park at the Hong Kong Airport terminal in Hong Kong. Photo: Reuters

Kyunghee Park

Qatar Airways, spurned by American Airlines Group and isolated in the Persian Gulf, snapped up 9.6pc of Hong Kong-based Cathay Pacific Airways in a surprise move that extends a policy of investing in major global carriers and provides a first foothold in East Asia.

Qatar Airways will purchase the stake for HK$5.16bn (€570m) from Kingboard Chemical Holdings and associates, according to a statement, becoming Cathay's third-largest investor after local conglomerate Swire Pacific with a 45pc holding and Air China with almost 30pc.

The Cathay swoop is in line with a strategy of blue-chip deals that have seen Qatar Air buy 20pc of Aer Lingus and British Airways owner IAG and 10pc of South American carrier Latam Airlines Group. At the same time the move reasserts the company's global ambitions almost five months after American Airlines rejected an investment bid. It also comes amid a Saudi Arabia-led blockade of Qatar that has led some flights to be scrapped and forced others to divert.

Akbar Al Baker, Qatar Air's chief executive officer, said the tieup advances his investment strategy by securing a stake in "one of the strongest airlines in the world", while Cathay counterpart Rupert Hogg added that he's looking forward to a "continued constructive relationship" with the Gulf operator.

Both companies are members of the Oneworld alliance, as are British Airways, Latam and American, though that didn't stop the US carrier's CEO Doug Parker opposing Qatari investment in his group.

(Bloomberg)

Irish Independent

Business Newsletter

Read the leading stories from the world of Business.

Also in Business