Abu Dhabi
Etihad Airways is on track to raise $2 billion by years end to pay for aircraft deliveries and investments in other airlines, chief financial officer James Rigney said on Thursday.
“The primary focus of that money is aircraft related and also for investments we have made in our equity partners,” he told reporters in Abu Dhabi.
Earlier this year, Etihad executives met with prospective lenders in London and New York.
Etihad will take delivery of 18 aircraft this year including ten airbus aircraft and eight Boeing planes. Its equity strategy in eight airlines, stretching from Australia to Ireland, saw it announce a fresh €300 million capital injection into Air Berlin earlier this year and in August a €560 million (Dh2.7 billion) deal to take a 49 per cent stake in Italy’s Alitalia.
Rigney, speaking on the sidelines of the International Air Transport Association (IATA) World Financial Symposium, said the financing was coming through loans.
Earlier, Gerardo Grajales, chief financial officer of Columbia’s national airline Avianca, took a swipe at Etihad’s stake acquisition strategy, that he said was for the privileged few that have access to large swathes of cash.
“To do what Etihad is doing takes a lot of capital. It takes a lot of cash … if you have the cash you can do it,” he said on a panel sitting next to Rigney.
Grajales is not the first aviation executive to critique the Abu Dhabi state-owned carrier’s strategy. Lufthansa, which owns a group of European carriers, has long opposed the three major Gulf airlines, including Emirates and Qatar Airways. The Gulf carriers have previously been accused of having unlimited access to oil-rich government coffers, some that the three major Gulf carries have all previously denied.
Rigney, speaking on the panel, said it was not about cash because Etihad had “borrowed [the] money for those investments.”
Etihad has raised more than $8 billion from 68 financial institutions for aircraft-related financing in the past decade. Last year, it raised $2 billion as it steps up its organic and acquisition growth strategy. Etihad’s order book sits at 200 aircraft; however, these can be spread across the eight airlines it holds stakes in.
