Etihad Airways, the national airline of the United Arab Emirates (UAE) has unveiled plans to acquire 49% of JatAirways. The Abu Dhabi-based carrier has also been awarded a five year management contract for the Serbian national airline as part of of a wide-ranging strategic partnership agreement, signed by Etihad Airways and the Government of Serbia, which includes a fleet of new aircraft, and a new integrated network of international destination.
The agreement follows the launch of Etihad Airways flights between Abu Dhabi and Belgrade in June and will significantly enhance trade and investment relations between the UAE and Serbia as well as boosting the tourism sector in both countries.
Economic ties between the two countries, valued at EUR 23.3 mln in 2012, three times greater than in 2011, continue to expand with a number of key government agreements signed in recent months which will see investments in agriculture, defence, technology, and tourism.
Within the agreement Etihad will make available a USD 40 mln loan facility which will be converted into equity on 1 January 2014, subject to regulatory approval. This will be matched by an equal funding injection by the Government of Serbia.
Etihad and the government of Serbia will also each provide further funding through shareholder loans and other funding mechanisms of up to USD 60 mln to meet working capital requirements and support network development for the newly created Air Serbia.
The rebranding and renaming of JatAirways to Air Serbia is a significant moment in the history of the Serbian carrier which is more than 80 years old. Tail fins on Air Serbia aircraft will feature the Serbian coat of arms and the country's state colours on both sides.
Among other planned developments will be an enhanced flight network, codesharing with Etihad Airways and airberlin, adding to Air Serbia’s current network of 33 cities another 12 destinations in Africa, Europe and the Middle East.
The current JatAirways fleet of 10 Boeing 737-300 aircraft will be retired from scheduled operations, and in the short term will be replaced by leased narrow body aircraft. In the longer term, an Air Serbia order will be made for 10 new narrow body aircraft.
Air Serbia will become Etihad Airways’ sixth equity partner following investments in airberlin (29.21%), Air Seychelles (40%), Virgin Australia (10.5%), Aer Lingus (2.99%) and most recently Jet Airways (24%).
Etihad Airways operates a two-cabin Airbus A320 between Larnaca and Abu Dhabi every Monday, Wednesday and Friday.
For information, visit: www.etihad.com
Etihad takes 49% stake in Serbia’s Jat Airways
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