(Adds detail, background)
BELGRADE, July 26 The United Arab Emirates'
Etihad Airways will a sign a strategic partnership deal with
loss-making Serbian flag carrier JAT Airways on Aug. 1, a
Serbian government source said on Friday.
Neither airline would reveal details of the deal on Friday,
but after signing a preliminary agreement last month on a
possible equity investment Etihad CEO James Hogan said the
airlines would discuss "ways to further integrate their networks
and help JAT Airways achieve efficiency, build revenue and
Etihad and JAT agreed in April to share route-booking codes
but stopped short of an equity tie-up, though Belgrade-based
media have suggested that Etihad may take a stake of more 49
percent in JAT.
The new agreement will be signed on Aug. 1 by Serbian Deputy
Prime Minister Aleksandar Vucic and Etihad's Hogan, the
government source said on Friday.
Serbia is aiming to offload loss-making state businesses,
including JAT, drugs company Galenika and the Zelezara Smederevo
steel mill, to keep its 2013 budget deficit at about 4.7 percent
of output and secure growth of up to 3 percent.
However, its attempts to sell JAT have failed because of
lack of interest from prospective buyers.
JAT currently operates 10 Boeing 737-300s and four
ATR 72-200 turboprop aircraft on 30 routes
within Europe and to the Middle East.
(Reporting by Fedja Grulovic; Writing by Maja Zuvela; Editing
by David Goodman)