Like a celebrity mismatch, the rumored Lufthansa-Etihad merger flooding news feeds was bound to disappoint, and now Reuters reports that “a financial stake is out of the question at the moment,” citing a source close to the plans. But given the move towards code sharing, and the Gulf-carrier’s proclivity towards investing in other European carriers, there is a grain of truth in to the story. Etihad is, indeed, looking to cooperate on more routes as Gulf carriers eat up the last of the low-hanging fruit for easy growth.
Il Messaggero reported earlier this week, without citation, that both carriers had been examining the possibility of Etihad buying a 30- to 40-percent stake in Lufthansa, through a sale of new shares to the Abu Dhabi state-owned airline. The sale was regarded as a precursor to a potential merger. However, Etihad now denies any such intentions.
An Etihad spokesman told the media that it was “not looking to take a financial stake in Lufthansa.”
Meanwhile, president and CEO James Hogan, in a speech yesterday, said that Etihad Aviation Group’s partnership strategy remained a core element of the group’s growth strategy. Hogan pointed to 5.5 million connections to the Etihad Airways network from code shares and partners in 2016. “Our investments had an immediate impact on the revenue side, delivering hundreds of millions of dollars in additional revenues and allowing us to fill our onward connecting flights,” he said. “Those benefits have been replicated in all our minority investments – in airberlin, Alitalia, Jet Airways, Virgin Australia, Air Serbia, Air Seychelles and Etihad Regional.”
So, while Etihad isn’t (publicly) making moves on Lufthansa’s ownership, the two signed a ground-breaking agreement to code-share, in a deal that signaled “a much closer relationship between the two national carriers.”
Hogan added: “It is very clear to us at Etihad Airways that Lufthansa is a like-minded, forward-thinking organization with which we can do strong, meaningful and mutually beneficial business.” Sounds like the pas de deux is not over yet…Like This Post