FARNBOROUGH, ENGLAND—Qatar Airways Tuesday said it plans to take a stake of up to 10% in LATAM Airlines Group as it continues to expand its investment in other carriers.
Qatar Airways chief executive Akbar Al Baker said the airline would invest $613 million in the struggling Latin American carrier, which has been hit by weak local demand.
Mr. Al Baker said he and his company “recognize short-term localized challenges,” but remained confident in LATAM’s long-term prospects.
Under the terms of the deal LATAM would also hold a fresh fundraising round, to which Qatar Airways would subscribe.
Qatar Airways is a oneworld alliance partner with LATAM, and is also the largest shareholder in British Airways parent International Consolidated Airlines Group SA, also a member of the alliance.
LATAM shareholders still have to approve the investment at an extraordinary shareholder meeting, which will take place before Sept. 2.
“We believe this investment will allow us to explore new possibilities to connect South America with the Middle East and Asia and strengthen our financial position,” LATAM chief executive Enrique Cueto said.
Qatar Airways also is considering a stake in Italy’s Meridiana airline, though Mr. Al Baker Monday expressed concern talks with unions weren’t progressing as hoped. Qatar Airways may have to walk away from the investment, he indicated.
The Wall Street Journal
Qatar Airways to purchase 10% of LATAM
