Qatar Airways announced second airline share purchase this week. Taking 10% stake on Latam Airlines (read more here) was not enough. The airline decided to purchase 49% of Meridiana. Both deals are still pending.
Meridiana is an Italian airline that has been around since the 1960’s but is relatively unknown internationally, although it uses Avios as its loyalty program currency.
Here’s an excerpt from WSJ (access the piece here):
Meridiana has been coping with financial losses for years. Its network connects the main Italian cities with Sardinia and other destinations in Europe, Africa and the U.S. Its fleet consists of Boeing 737s, 767s and MD-82s.
Qatar Airways had earlier signaled its interest in investing in the Italian carrier but talks with Meridiana’s unions had appeared to have stalled the deal. Mr. Al Baker has previously said Meridiana’s employees would have to accept restructuring measures, including layoffs.
And Reuters take on job losses (access the article here):
Meridiana had asked labor unions to agree to 900 job cuts – nearly half its workforce – as part of a planned partnership with Qatar Airways, a person involved in the talks told Reuters in February.
Last month, the Italian government, unions and Meridiana reached an agreement opening the way for the deal to go ahead.
The agreement included the loss of about 400 jobs and a 20 percent wage cut compared with those stipulated in national collective contracts for the sector, union officials said.
And from Bloomberg (access the piece here):
Qatar Air signed an agreement with Alisarda SpA, a holding company of the Aga Khan that owns Meridiana, for a transaction expected to be completed in early October, subject to “certain conditions,” the carrier said Thursday in a statement, without specifying the value or other terms.
The accord “sets the path to progress” for a “strong resolution” that will benefit employees and passengers of Meridiana, Qatar Airways Chief Executive Officer Akbar Al Baker said in the statement following the contract signing at the Farnborough Air Show outside London.
Qatar Airways is likely going to use Meridiana to tunnel traffic to its hub in Doha. Easier to use an European airline to do this than trying to get an access to more airports within the EU (where ME3 are feeling bit of a push back from national airlines).
Etihad Airways has already implemented this strategy with Airberlin, Alitalia, Jet Airways and Air Seychelles. All these airlines fly to Abu Dhabi to feed other Etihad flights.
Qatar Airways is also rumored to in negotiations to buy a stake on Royal Air Maroc…..