Qatar Airways Plans to Take 10% Stake in LATAM Airlines
July 12 2016 - 5:40AM
Dow Jones News
FARNBOROUGH, ENGLAND—Qatar Airways Tuesday said it plans to take
a stake of up to 10% in LATAM Airlines Group as it continues to
expand its investment in other carriers.
Qatar Airways chief executive Akbar Al Baker said the airline
would invest $618 million in the struggling Latin American carrier,
which has been hit by weak local demand.
Mr. Al Baker said he and his company "recognize short-term
localized challenges," but remained confident in LATAM's long-term
prospects.
Under the terms of the deal LATAM would also hold a fresh
fundraising round, to which Qatar Airways would subscribe.
Qatar Airways is a oneworld alliance partner with LATAM, and is
also the largest shareholder in British Airways parent
International Consolidated Airlines Group SA, also a member of the
alliance.
LATAM shareholders still have to approve the investment at an
extraordinary shareholder meeting, which will take place before
Sept. 2.
"We believe this investment will allow us to explore new
possibilities to connect South America with the Middle East and
Asia and strengthen our financial position," LATAM chief executive
Enrique Cueto said.
Qatar Airways also is considering a stake in Italy's Meridiana
airline, though Mr. Al Baker Monday expressed concern talks with
unions weren't progressing as hoped. Qatar Airways may have to walk
away from the investment, he indicated.
Write to Robert Wall at robert.wall@wsj.com
(END) Dow Jones Newswires
July 12, 2016 06:25 ET (10:25 GMT)
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