Qatar Airways, spurned by American Airlines and isolated in the Persian Gulf, snapped up 9.6 per cent of Hong Kong-based Cathay Pacific Airways in a surprise move that extends a policy of investing in major global carriers and provides a first foothold in east Asia.
Qatar Airways will purchase the stake for HK$5.16 billion (€570 million) from Kingboard Chemical Holdings and associates, according to a statement, becoming Cathay’s third-largest investor after local conglomerate Swire Pacific, with a 45 per cent holding, and Air China Ltd. with almost 30 per cent.
The Cathay swoop is in line with a strategy of blue-chip deals that have seen Qatar Air buy 20 per cent of British Airways owner IAG and 10 per cent of No. 1 South American carrier Latam Airlines.
At the same time the move reasserts the company’s global ambitions four and a half months after American Airlines rejected an investment bid. It also comes amid a Saudi Arabia-led blockade of Qatar that has led some flights to be scrapped and forced others to divert.
Behind the Cathay Pacific stake is the battle for better access to China. – Bloomberg