Endless possibilities: Etihad to acquire 49% of Alitalia
Etihad Airways plans to buy a 49 per cent stake in Alitalia, its president and CEO James Hogan told US business leaders at a lunch in Los Angeles on Wednesday.
Addressing guests at the Beverly Wilshere hotel, Hogan outlined the investment stakes Etihad has in Air Serbia, Air Seychelles, Air Berlin, Jet Airways, Virgin Australia and Aer Lingus – and then referred to Alitalia.
“Currently we are in negotiations to acquire Alitalia, 49 per cent of Alitalia,” he said. It is believed to be the first time the size of the stake has been stated publicly.
His remarks came even as Italian Transport Minister Maurizio Lupi revealed on Wednesday that Etihad is prepared to invest up to 1.25 billion euros ($1.7 billion) in Alitalia over the next four years. While 560 million euros would be used to buy new shares in the airline, the rest would be invested in planes, design and training, he told reporters in Rome.
The Abu Dhabi carrier, which began operations to Los Angeles earlier this week is in the final stage of negotiations with the Italian carrier.
In his speech, Hogan explained how Gulf airlines are at the “forefront of innovation” and have taken advantage of their geography to create connectivity, which has benefited business and leisure.
Bilateral trade between the UAE and the US totalled $26.9 billion last year.
He also underlined Etihad’s pivotal commercial relationship with the US, and particularly Boeing and General Electric. Etihad will be the largest operator of B787-9s and B787-10s (71 on order) and also has 56 B777s, valued at $25.2 billion, on its order books.
“It’s disappointing that we’ve come under huge pressure from airlines in America in the way we operate – business is business,” he said. “I’ve had the advantage of a clean piece of paper. I would argue that many of our critics, if they were in my place, would do exactly the same thing.”
Eric Garcetti, mayor, City of Los Angeles, said: “We used to say that if you drilled a hole down you end up in China – but the correct thing is the UAE. There’s no place you can’t get to from the UAE, and there’s nothing you can’t experience in Los Angeles.”
Garcetti announced that Los Angeles International Airport (LAX) will undergo a $7.3 billion reinvestment project designed to cement its hub status “as the western capital of the US, the northern capital of Latin America and eastern capital of the Pacific Rim”. The airport handled 66 million passengers last year and is growing at around six per cent.
- Oman’s Duqm tourist complex moves forward with government approval
- Kuwait fights budget deficit: Reexamining government salaries, expatriate labor
- Tunisian Confederation of Industry, Trade, and Handicrafts fights nationwide unemployment levels
- Construction costs fall in Dubai
- Western tourists flock to Iran, could generate $30B in new revenue
- Alitalia and Etihad Airways finalise €1,758 million investment deal to build a reinvigorated Alitalia as a competitive, sustainably profitable business
- Etihad Airways acquires majority stake in Alitalia’s millemiglia frequent flyer program
- Airline Darwinism: Eithad, Alitalia reach breakthrough in negotiations
- Etihad flying high after becoming largest shareholder in Alitalia
- Etihad Airways increases stake in Virgin Australia