Qatar Airways Increases IAG Stake To 25.1%

Filed Under: British Airways, Qatar

Qatar Airways has just increased their stake in IAG, the parent company of British Airways, Iberia, and Aer Lingus.

Qatar Airways increases IAG stake to 25.1%

It has today been announced that Qatar Airways has increased their stake in IAG from 21.4% to 25.1%.

Qatar Airways’ CEO, Akbar Al Baker, says that the investment has been successful so far, and that Qatar Airways is always considering opportunities to invest in other airlines:

“Our investment to date has been highly successful and the announced increase in our shareholding is evidence of our continued support of IAG and its strategy.

Qatar Airways continues to consider opportunities to invest in airlines and support management teams that share our vision to enhance travel opportunities for airline passengers across the globe.”

Qatar Airways likes to invest in other airlines

Qatar Airways first bought a 9.99% stake in IAG back in 2015, and has increased their stake in IAG a couple of times since then.

In January of this year, IAG removed the limit on non-EU ownership of the company. This came as non-EU ownership of the company decreased from 47.5% to 39.5%, allowing them to remove maximum limits on non-EU ownership.

The change in structure wasn’t needed for Qatar Airways to be able to increase their stake to the current amount. Rather this came ahead of Brexit, as the airline wants to still be at least 50% owned by EU investors, so that they can maintain current operating rights.

Qatar Airways has increased IAG stake several times now

Qatar Airways’ current airline investments

Qatar Airways has been investing pretty aggressively in other airlines. Qatar Airways is wholly owned by the government of Qatar, so it’s essentially a way for the government to diversify assets, while either directly or indirectly helping Qatar Airways.

As of now Qatar Airways owns:

Qatar Airways owns a stake in Cathay Pacific

These have all been pretty passive investments, which is to say that we haven’t seen all that much additional cooperation between Qatar Airways and those airlines.

Then you have Air Italy, which liquidated last week, and which Qatar Airways owned a 49% stake in. That was an investment where Qatar Airways clearly took a very active role in management, and that didn’t work out very well.

Air Italy, which Qatar owned a 49% stake in, recently liquidated

As Al Baker said in the above quote, the airline has considered increasing stakes in existing airlines, or investing in new airlines altogether:

  • Al Baker has expressed interest in increasing their stake in LATAM, though that might just be to play games with Delta, since they purchased a 20% stake in LATAM
  • There’s talk of Qatar Airways investing in some African airlines, in particular RwandAir, as Qatar has already invested in the new Kigali Airport

Qatar Airways is allegedly considering a stake in RwandAir

The politics of all of this is amusing, as always

This is of course nothing new, but I can’t help but be amused by the politics of all of this. The government of Qatar is essentially investing in several global airlines, and that creates a funny dynamic:

  • Delta thinks the Gulf carriers are essentially trying to destroy global aviation, and Delta stole LATAM out from under American, but at this point Delta has a 20% stake in LATAM, and Qatar Airways has a 10% stake
  • American cut codeshare ties with Qatar Airways because they don’t like government subsidized airlines participating in the Open Skies agreement, but they have a joint venture with British Airways and Iberia, where Qatar Airways is one of the biggest shareholders

Again, none of this is new, but the politics of global aviation can’t help but make me giggle sometimes…

Bottom line

Qatar Airways has upped their stake in IAG to over 25%. There aren’t many practical implications to this, as this is a pretty passive investment, and Qatar Airways doesn’t seem to be trying to exert much control because of this investment.

This investment comes just days after Air Italy liquidated, though that’s mostly unrelated.

It’ll be interesting to see what other airlines Qatar Airways invests in, and if they’ll stick to passive investments, or if they’ll try another Air Italy-style investment (where they try to give an airline the Qatar Airways “experience,” even if there’s no business case for it).

Comments
  1. Yes. QR has a 5% stake in CZ, and MF (if you mean Xiamen Air), while not directly involved with QR, is owned by CZ. Though CZ has now left SkyTeam, MF is still in. However, QR’s and AA’s involvement does not lead to CZ joining Oneworld. In another part of the Pearl River Delta, QR owns CX too.

  2. What about last year’s tantrum by AAB when he threatened to leave Oneworld ? QR’s investments certainly do not support this. I could bet that this was said with a purpose and that, behind the scenes, he got what he wanted.

    While AAB is widely dismissed as a loud mouth and a buffoon, I strongly disagree. The man is brilliant. There is nothing wrong providing quality service, nothing wrong refusing the delivery of unfinished or sub-par aircraft, and nothing wrong with taking advantage of the local employment and pay conditions to build a powerhouse.

    I do wish that he’d replace whoever is in charge, under him of running aircraft parking operations at DOH, as having at the same time so many empty gates and so many remote stand departures / arrivals is a drag. This is probably my major gripe about an otherwise very well run operation in difficult conditions (that stupid blockade).

  3. American cut fare interlining with Qatar, which is far more damaging than cutting codeshares (which are a marketing gimmick). If you’re flying Qatar, American will simply not allow you to connect under the same fare.

    Qatar passengers arriving in the U.S. can connect on the same fare only on Alaska Airlines or JetBlue. What a sad country.

  4. @Semperfi82: What the heck is JSX? Oh, I get it: JetSuite. You might as well have been more to-the-point, but never mind.

  5. @Pierre: I would describe the man as an eccentric genius. Shrewd, and plays the crying-wolf card (leaving Oneworld), and yet exerts Qatari soft power over the world like few others can. We have not had a sound-bite from him since the ‘grandmothers’ comment in Dublin. Maybe he has shut up.

  6. What is he going to do with those 787s he wanted to push off to Air Italy. Maybe he can convince BA to snag a few and expand more TATL destinatuons and other long haul.

  7. @jake not true, I’m flying American from Mia to jfk and connecting on Qatar to doh and on to cpt. I’m on a RTW ticket.

    Maybe QR buys a bigger share than delta in LATAM and they return to 1W and show the joke heading AA how things are done.

Leave a Reply

Your email address will not be published. Required fields are marked *