Etihad Airways “remains committed” to Air Serbia

Etihad Airways will stay on as a minority shareholder in Air Serbia, despite a recent recapitalisation reducing its stake in the carrier to just 16.4%. The Serbian airline is Etihad’s last remaining equity partner following a disastrous run of investments in near-bankrupt carriers including Air Berlin and Alitalia. “Etihad is Air Serbia’s strategic partner. It should not be forgotten that the company used its know-how, knowledge, and experience and fundamentally influenced the transformation of Jat Airways into a modern European carrier that Air Serbia is today”, the Serbian airline said. It added, “Our partners from Etihad shared their knowledge and resources to develop this joint project. To this day, Etihad representatives actively participate in the work of our Supervisory Board and cooperate with the company’s management”.

Etihad has four members on the Air Serbia Supervisory Board, including its Senior Vice President Technical, Chief Human Resources, Chief Financial Officer, as well as Vice President for Corporate Investments and Subsidies. Furthermore, it has its authorised representative as part of the Shareholders’ Assembly.

Etihad, which had a 49% stake in Air Serbia just two years ago, decreased its stake to 18% in December 2020 when the Serbian government stepped in to recapitalise the airline to the tune of 100 million euros to alleviate the effects of the coronavirus pandemic. In late August of this year, Air Serbia issued 1.82 million new shares which were purchased by the government, further decreasing Etihad’s stake. The Emirati carrier did not participate in the acquisition of the stock due to “current circumstances”. For its part, Etihad said, “Etihad is and remains fully committed to Air Serbia and to the strategic partnership with Air Serbia’s majority owner, the Government of Serbia”.

Etihad Airways has devested from all of its other equity partners over the past years, including Virgin Australia and Air Seychelles. Under the leadership of Tony Douglas, who has been heading the company since 2018, the carrier’s focus has been on returning to profitability following years of steep losses. Mr Douglas previously branded the equity investments as “mistakes”, noting the company was part of a “failed quasi-alliance strategy”. Since 2018, engagement between Air Serbia and Etihad Airways has been significantly reduced. However, Mr Douglas is set to leave the company along with many Etihad executives at the end of the year, as they are believed to be headed to Saudi Arabia to help launch the country’s ambitious new mega-carrier RIA.

Air Serbia’s CEO, Jiri Marek, who was the first to be selected to run the rebranded airline without Etihad’s direct involvement, recently said, “Air Serbia has played an important role during the pandemic, supporting the Serbian government with repatriation flights, as well as the uplift of medical equipment and so on. I think we've proven that our operations do not only contribute to connectivity, but also bring significant economic benefits. We believe the government wants a strong national carrier that continues to grow. There are various models in the industry with different participation structures and different levels of state participation. Even combinations of private and state shareholding is possible. It is up to the Serbian government to find the most suitable model”.

EX-YU Aviation News

Share this post