Qatar Airways swoops for RwandAir stake, eyes bigger LATAM holding

CEO Akbar al-Baker says company will take its time to negotiate

DOHA: Qatar Airways is in talks to buy a 49% stake in Africa’s RwandAir and is interested in doubling its holding in LATAM Airlines Group to 20%, its chief executive said on Wednesday.

A stake in an African airline would widen its reach in one of the world’s fastest-growing aviation regions and potentially help it to bypass restrictions imposed on it by some Arab states.

“We are very tough negotiators ... we will take our time to negotiate,” CEO Akbar al-Baker told reporters in Doha.

State-owned Qatar Airways already owns stakes in British Airways parent International Airlines Group, China Southern, Cathay Pacific and LATAM. It bought some of its holdings in other airlines after the United Arab Emirates and Saudi Arabia banned it from their airspace after a regional political dispute. Qatar Airways, which flies to more than 160 destinations, has been forced to fly longer routes to avoid the blocked airspace of some of its neighbours.

The ban does not apply to non-Qatari airlines flying to Qatar, meaning that RwandAir could potentially carry passengers from Africa over the blocked airspace to the state-owned airline’s Doha hub without restrictions.

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RwandAir flies to 29 destinations, mostly in Africa, but also to Dubai, Mumbai and Brussels. Its CEO, Yvonne Manzi Makolo, confirmed to Reuters that talks to sell a stake were underway but declined to comment further.

Qatar Airways agreed in December to take a 60% stake in a new airport in Rwanda.

Baker, one of aviation’s most well-known executives, also said the airline could be interested in increasing its holding in LATAM and working with fellow shareholder Delta Air Lines. “When the right opportunity comes, and at the right price, we will look at increasing our investment in LATAM,” he told Reuters, adding that it would be interested in having the same size stake as Delta. Delta has a 20% holding, double the 10% owned by Qatar Airways.

Delta surprised the industry when it announced in September that it was taking a $1.9 billion 20% stake in the South American airline group.

Published in The Express Tribune, February 6^th, 2020.

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