Qatar Airways targets 10% stake in American Airlines

American Airlines has said that Qatar Airways, the Gulf country’s state-owned airline, has expressed interest in buying as much as a 10% stake, worth at least €724m ($808m), in the US airline.

The potential investment comes against a background of diplomatic and competitive turbulence for Qatar Airways, its home country and US airlines. Operations at Qatar Airways were disrupted after four Arab nations cut diplomatic and economic ties with Qatar this month in the worst diplomatic crisis in the region in years.

Separately, American, United Continental and Delta have pressed the US government to take action to curb American flights by Qatar and rival Gulf carriers Emirates and Etihad. The US carriers charge that their Gulf rivals have received billions of dollars in unfair state subsidies, allegations the Gulf carriers deny.

Investors cheered news of Qatar’s potential investment in American, sending shares of the U.S. carrier up more than five percent in pre-market trading. American shares were up about 2 percent in regular morning trade.

Qatar Airways indicated its interest in buying a stake in American on the open market, American said. Qatar Airways said in a statement that it sees a “strong investment opportunity” in American and that it “intends to build a passive position in the company with no involvement in management, operations or governance.”

“Qatar Airways plans to make an initial investment of up to 4.75%. Qatar Airways will not exceed 4.75% without prior consent of the American Airlines board. Qatar Airways will make all necessary regulatory filings at the appropriate time,” the Gulf carrier said.

However, American said it had received no request from Qatar for such approval.



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