Etihad inks deal for possible stake in Serbian carrier
Etihad Airways has signed a preliminary agreement with the Serbian government over a possible equity investment in the country's JAT Airways.
Details of the deal were unveiled by James Hogan, president and CEO of Etihad, and Velibor Vukasinovic, JAT Airways' CEO, at a media briefing on Monday.
The Abu Dhabi carrier said in a statement that any investment decision would depend on the successful completion of a comprehensive due diligence process and be subject to all necessary regulatory and respective board approvals.
Serbia is looking to offload loss-making state enterprises, including JAT, pharmaceuticals firm Galenika and the Zelezara Smederevo steel mill in a bid to keep its budget deficit at about 4.7 percent of gross domestic product (GDP) and secure growth of around 2 percent this year.
Hogan said: "These are early days but we are excited about the future and look forward to exploring the possibility of a much deeper strategic commercial partnership with JAT Airways."
The two airlines said they will now intensify discussions about collaborative efforts to further integrate their networks and help JAT Airways achieve efficiencies, build revenue, and reduce costs.
He added: "As we have demonstrated with our minority equity investments in other airlines, significant on-going savings can be achieved through joint initiatives."
The announcement follows the launch of Etihad's daily flights between Abu Dhabi and Belgrade on Saturday.
Hogan said: "As the partnership between Etihad Airways and JAT Airways deepens, and new codeshare destinations are added, we will see greater numbers of travellers being fed across the two networks."
In April, Etihad and JAT agreed to share route-booking codes but stopped short of an equity tie-up.