June 22, 2017
Whoa-Qatar is Considering Buying 10% of American Airlines
News outlets are reporting that Qatar Airways is considering purchasing up to 10% of American Airlines. The purchase won’t be done with the blessing of American Airlines. American is a vocal critique of Qatar, Emirates, and Etihad and claims they’re government subsidized airlines which are hurting the US airline industry. If Qatar wants to do this deal, it will be purchasing AA stock on the open market.
Qatar says it wants to invest in American as it’s a “strong investment opportunity”. As of now, it doesn’t plan on being an active investor involved in management decisions. Qatar will initially purchase 4.75% of American’s stock ($808 million), the maximum allowed without approval of American’s board of directors. American put out the following statement following news of the purchase:
“It does not alter American Airlines’ conviction on the need to enforce the Open Skies agreements with the United Arab Emirates and the nation of Qatar and ensure fair competition with Gulf carriers.”
Basically, American remains an outspoken critique of the Middle-Eastern airline. 10% is a sizeable investment if AA’s board approves the purchase. It’ll be interesting to see if American changes any of its customer-unfriendly policies if Qatar decides to take on a more active role in the company. Qatar was just named the #1 airline in the world this week and is launching its gorgeous QSuite Business Class this month. American can learn a thing or two from its newest investor.