DOHA: Qatar Airways is reportedly in advanced negotiations to acquire a 20 per cent stake in Virgin Australia, with expectations that the deal will be finalised imminently.
The potential acquisition is currently awaiting approval from the Australian Foreign Investment Review Board, and sources indicate that the agreement could be signed within days.
The discussions were first brought to light by The Australian Financial Review in June, highlighting the ongoing strategic maneuvers within the aviation industry.
The impetus for this acquisition stems from the desire of Virgin Australia’s owners, Bain Capital, to divest their significant short-term investment in the airline.
Bain Capital’s initial purchase occurred during a period of insolvency and receivership for Virgin, and despite efforts over the past two years to attract buyers for their share placement offering, they have struggled to find suitable takers.
Eyes more investments
Consequently, the firm shifted its strategy to seek out strategic airline investors, a move that aligns with Qatar Airways’ established investment approach.
Qatar Airways has a history of strategic investments in international airlines, holding a 10 per cent stake in Cathay Pacific and a 20 per cent stake in International Airlines Group (IAG), which encompasses British Airways, Iberia, and Aer Lingus.
Recently, the Gulf carrier expanded its portfolio by acquiring a 25 per cent stake in South Africa’s Airlink, further solidifying its presence in the African aviation market.
The pattern of investment underscores Qatar Airways’ commitment to enhancing its global network and operational synergies.
The potential partnership between Virgin Australia and Qatar Airways is poised to yield mutual benefits, extending beyond mere financial investment. Enhanced offerings for Virgin Australia’s Velocity members, such as access to Qatar’s frequent flyer lounges in Doha and additional earning opportunities for Velocity Points and status credits, are anticipated outcomes of this collaboration.
Such enhancements would not only elevate the customer experience but also strengthen loyalty among frequent travelers.
Badr Mohammed Al-Meer, the chief executive of Qatar Airways, has indicated that the Gulf airline is actively seeking further investment opportunities. His statement to the Financial Times highlights a strategic vision for collaboration and growth within the aviation sector.
As Qatar Airways continues to expand its portfolio, the acquisition of a stake in Virgin Australia may represent a significant step towards achieving its broader objectives in the competitive landscape of global air travel.
