While Qatar is suffering under a blockade by Saudi Arabia, Bahrhain, and the United Arab Emirates, the national airline is going strong full steam.
Always trying to be a step ahead of competitors Emirates and Etihad Airways, Qatar Airways announced that it has entered into an agreement to purchase an amount of 378,188,000 shares of Cathay Pacific Airways Limited being approximately 9.61 percent of the total issued share capital. Completion of the transaction is expected to take place later today in Hong Kong.
Qatar Airways will become the third biggest shareholder of Asia’s largest international airline.
The state-owned Middle Eastern carrier agreed to buy 378.18 million shares at HK$13.65 (US$1.75) per share for HK$5.16 billion from Hong Kong industrial company Kingboard Chemical, according to a stock exchange filing.
The transaction will be completed later on Monday, Qatar Airways said.
Kingboard founder Paul Cheung Kwok-wing had only piled up his stake in Cathay Pacific earlier this year and declared at the time that he was a “long-term investor”. With the share sale, his company can expect about HK$800 million in profit.
Hong Kong conglomerate Swire Pacific remains the largest shareholder in Cathay with a 45 per cent stake and Air China controls 29.99 per cent, while the remaining shares not owned by Qatar Airways are publicly traded.
Qatar Airways Group CEO Akbar Al Baker heaped praise on his new acquisition as “one of the strongest airlines in the world, respected throughout the industry and with massive potential for the future.”
In a statement, Cathay Pacific CEO Rupert Hogg, said: “Qatar Airways is one of the world’s premier airlines. We already work together closely as fellow members of the Oneworld alliance and we look forward to a continued constructive relationship.”
Hong Kong’s flagship airline has had a difficult few years, facing mounting competition from Middle Eastern, mainland Chinese and low-cost carriers which now offer flights to the same destinations served by Cathay Pacific. The carriers usually include a stop at their home airports, making their fares cheaper than Cathay Pacific’s direct flights.
Qatar Airways Group Chief Executive, His Excellency Mr Akbar Al Baker, said: “Qatar Airways is very pleased to complete its financial investment in Cathay Pacific.” “Cathay Pacific is a fellow Digital XNUMXkworld member and is one of the strongest airlines in the world, respected throughout the industry and with massive potential for the future.”
This investment further supports Qatar Airways investment strategy which already includes 20% investment in International Airlines Group, 10% investment in LATAM Airlines Group and 49% investment in Meridiana.”