Etihad Airways hikes stake in Virgin Australia

Abu Dhabi: ) Etihad Airways, the national airline of the United Arab Emirates (UAE), has raised its stake in Virgin Australia Holdings to 19.9 percent following a series of on-market purchases of shares over recent weeks.

The Abu Dhabi-based airline now holds more than 515 million shares, which means that it has reached the threshold approved by Australia's Foreign Investment Review Board in June.

"We are delighted to have reached this milestone,” James Hogan, president and chief executive officer of Etihad Airways, said in a statement Thursday.

“It reflects our strong support for the business strategy and management team of Virgin Australia and our enduring commitment to the Australian market. It also reflects the close working relationship between our two airlines and we look forward to strengthening its commercial foundations,” he added.

Etihad Airways and Virgin Australia signed a 10-year strategic partnership agreement in August 2010 that includes code-sharing on flights, joint sales and marketing activities, and reciprocal "earn-and-burn" on their respective frequent flyer programmes.

"The strategic partnership continues to deliver significant revenue streams and other benefits to each airline," Hogan said.

"Increasing our equity in Virgin Australia will further enrich the commercial benefits which the partnership delivers for both airlines as well as increasing the benefits to Australian travellers and visitors to Australia."

Those benefits include seamless connectivity to more than 40 code-share destinations in Australia, New Zealand, Indonesia and Thailand and loyalty programme privileges such as priority baggage handling, priority boarding and airport lounge access for top tier programme members.

Collectively, Etihad Airways and Virgin Australia operate 28 flights a week between Abu Dhabi and Australia and passengers have access to a combined global network of more than 280 destinations.

Etihad Airways began flying to Australia in March 2007, when it launched services to Sydney.

Flights to Melbourne and Brisbane followed in 2009. The airline has carried more than 2.5 million passengers between Abu Dhabi and these three Australian gateways in the past six years, and plans to operate services to Perth in Western Australia in the future.