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By Praveen Menon and Stanley Carvalho
ABU DHABI, April 7 Etihad Airways is still
negotiating commercial terms for a potential investment in
Alitalia and is close to extending its partnership with Air
Berlin, the chief executive of the Abu Dhabi airline
said on Monday.
The Gulf carrier is eyeing an investment in Alitalia as it
uses a combination of equity alliances and organic growth to
expand its global reach and compete with fast-growing regional
rivals Emirates and Qatar Airways.
Alitalia, kept afloat by a government-engineered 500 million
euro ($686 million) rescue package last year, needs to find a
cash-rich partner quickly to revamp its flight network or else
risk having to ground its planes.
Etihad said in February it was in the final stages of a due
diligence process for a possible investment in Alitalia and
would make a decision in a month. The deadline has now passed.
The Gulf carrier is expected to give a proposal to the
Italian airline soon to start formal talks on the potential
investment, sources have told Reuters.
However, Hogan said on Monday that it was still at the due
diligence stage on Alitalia.
"The mandate we have from shareholders is if we can achieve
an agreement that meets the commercial mandate, we'll come back
and present that to the board. That's where we are at the
moment," he said at an aerospace conference in Abu Dhabi.
Etihad already has minority stakes in Air Berlin, Virgin
Australia, Aer Lingus, India's Jet Airways
It is also looking to restructure Air Berlin, in which it
owns a near 30 percent stake, as the German carrier faces
financial challenges amid competition from rivals such as
Late last month, German monthly magazine WirtschaftsWoche
said Air Berlin would be delisted and Etihad would raise its
stake to 49.9 percent, possibly as a prelude to combining it
"Entering into the Air Berlin partnership gave us access to
Germany," said Hogan.
"All our objectives have been met and we are in the final
stages of negotiating the next stage of that (Air Berlin)
partnership," he said without elaborating.
(Editing by Andrew Torchia and Mark Potter)