Etihad Airways takes stake in Aer Lingus

DUBAI, United Arab Emirates (AP) ? Fast-growing Etihad Airways has taken a nearly 3 percent stake of Aer Lingus as part of a strategy to build closer bonds with the Irish carrier, the Abu Dhabi-based airline said Tuesday.

Financial terms of the deal were not disclosed. But it appears part of a wider Etihad effort to seek shares in smaller carriers to gain a possible edge in its rivalries with Gulf carriers Emirates and Qatar Airways.

Etihad said Tuesday the 2.987 percent stake in Aer Lingus reflects a "desire to forge a commercial partnership with the Irish national carrier."

Etihad in recent months has bought large stakes in Airberlin and Air Seychelles in a bid to challenge Emirates and Qatar Airways. Etihad operates 10 flights a week from its Abu Dhabi hub to Dublin.

The head of Qatar Airways, however, said the carrier is not currently looking to acquire another airline.

Qatar Airways Chief Executive Officer Akbar al-Baker said the airline is focused on building its own business, and doesn't want to take on the financial problems of restructuring a weaker carrier. Al-Baker was in Dubai for a travel expo.

State-owned Qatar Airways competes for long-haul international passengers with Dubai-based Emirates airline and Etihad Airways.

"Qatar Airways is not interested in an acquisition at this time," al-Baker said before Etihad's deal was announced. "We do not just acquire loss-making entities because we are going to get it at a very good price and take advantage of their difficulties."

He said Qatar Airways would only be interested in well-run, promising airlines that are unable to find needed cash. Qatar Airways already has stake in the Luxembourg-based freight carrier Cargolux.

"We are not in this business of restructuring. We are in the business of making money," he said.

Last month, Etihad said its sales jumped 28 percent to $989 million in the first quarter of the year as it pushed ahead with its rapid expansion.

In February, Aer Lingus reported a strong growth in profits for 2011 despite the country's economic downturn. The Dublin-based carrier says in a statement Tuesday its full-year net profit rose 66 percent to euro71.2 million ($95.6 million). Sales rose 6 percent to euro1.29 billion ($1.73 billion).

Reports have linked Etihad to Air Lingus in the past. While not commenting directly on a tie-up with the Irish carrier, Etihad has expressed an interest in pursuing further acquisitions to expand its reach. The carrier also suggested its minority stake buy could be the start of a deeper partnership.

"Etihad Airways believes a possible partnership could produce significant commercial benefits for both airlines," Etihad said in a statement announcing the deal. Etihad executives were not immediately available to comment further.

Etihad has been flying to Dublin since 2007. It operates a premium lounge and an engineering maintenance facility at the Irish airport.

Etihad also holds nearly 30 percent German carrier Airberlin and 40 percent of Air Seychelles.

Associated Press

sidney crosby at the drive in alternative minimum tax modeselektor gran torino gloria steinem war of the worlds