(Berlin) – United Arab Emirates airline, Etihad has become the biggest shareholder in Germany’s second-largest airline Air Berlin by signing the agreement to pay 72.9 million Euros ($95 million); German group said.
Air Berlin in a statement said, “Etihad formerly held 2.99 percent in the German carrier and now it will buy 31.6 million more shares in a capital increase, thereby raising its stake to 29.21 percent. The new shares are being issued at a price of 2.31 Euros apiece”.
Air Berlin while appraising the agreement said, “The increase in Etihad’s shareholding, would cement a strategic cooperation between the two airlines that would include extensive code-sharing. Etihad has also undertaken to arrange for a debt financing totaling $255 million for Air Berlin”.
At the same time, Etihad had pledged to keep hold of its shares in Air Berlin for at least two years, but would not seek to increase its holding any further or launch a public takeover offer for the German group, Air Berlin said.
Hartmut Mehdorn Chief Executive at Air Berlin said, “The partnership with Etihad would become our new gateway to Asia and Australia”.