Switzerland’s aviation regulator has approved Etihad Airways’ acquisition of a stake in Darwin Airline, the two carriers said.
In early 2014, Etihad said that it would buy 33.3 per cent of the Swiss airline, which was later rebranded to Etihad Regional. However, after an initial review, in August the Federal Office of Civil Aviation (Foca) said it was investigating if the deal was in line with European restrictions on foreign control of the region's airlines.
“After our latest meeting held in February, we were confident that we could reach a positive outcome with Foca approving our deal with Etihad Airways,” said Maurizio Merlo, the chief executive of Lugano-based Darwin.
“We presented our new business plan with all related financial projections, and Foca confirmed that these plans would comply with the European regulations.”
James Hogan, Etihad’s chief executive, said that the lengthy regulatory review process had come at a cost.
“Because of the time taken to approve this partnership, and intense competition during this period, Etihad Regional has been forced to reduce or withdraw services on a number of routes, which were launched on the expectation that they would be supported by traffic flowing between the Etihad Airways global network and the Etihad Regional network in Europe,” he said.
He added that once the formalities are done, Etihad Regional will have “greater connectivity” in Europe via its partnership with Etihad and its partners Alitalia, airberlin, and Air Serbia.
Etihad’s growth strategy has been focused on acquiring minority stakes in struggling airlines to boost its geographic footprint and connectivity.
By the end of last year, Etihad had acquired minority stakes in a total of eight airlines, creating an equity alliance that also includes Air Seychelles, Virgin Australia and India’s Jet Airways.
Arabian Gulf carriers are facing a backlash from some European rivals who see them as encroaching on their domestic markets, helped by what they perceive to be state aid.
Last week, Swiss International Airlines, which is owned by Germany’s Lufthansa, stepped into the row, urging authorities to respond to the increasing competition from Etihad, Emirates Airline and Qatar Airways.
selgazzar@thenational.ae
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