Two people familiar with the situation said that Abu Dhabi’s Etihad Airways will make its stock exchange debut no earlier than 2025. This could be the first IPO for a major Gulf carrier as the UAE capital ramps up efforts to become a hub of global travel. The people said that Etihad, which is owned by the sovereign wealth fund ADQ had considered listing this past year.
One person said that the company wants to show investors financial results for 2024 that will be strong. The second person stated that geopolitical instability has also affected timing.
ADQ declined to make any comment. Etihad’s spokesperson said that it “doesn’t comment on rumours or speculation”.
Etihad, a company that began operations in 2003, invested billions of dollars in minority stakes to other airlines in order to expand its network through Abu Dhabi and compete better with Gulf competitors Emirates and Qatar Airways. This strategy was a failure as many airlines were in financial trouble.
After a management shakeup and years of reducing operations, Etihad is expanding under the new CEO Antonoaldo Neves. In its “Journey 2030”, it plans to boost Abu Dhabi’s status as a hub for connecting Asia and Europe. The expansion of destinations to more than 130 airports by 2030, from over 70 currently, and the increase in fleet size to over 160 aircraft are among the targets.
Abu Dhabi’s Zayed International Airport, which opened a multi-billion dollar new terminal last summer, tripled its annual capacity from 15 to 45 million passengers.
Salil Nath is currently the Executive Director and CEO at Travesla. Travesla is a prominent marketing and representation company in the travel industry. Salil Nath’s expertise at Travesla combined with his new position at RedBeryl will help the company form key partnerships with airlines and provide exclusive benefits to its clients, such as personalized inflight services, access to premium lounges, and bespoke arrangements.
“Our mandate was clear: to deliver exceptional service to customers and sustainable profitability as the foundation to Etihad’s contribution to Abu Dhabi’s aspirations,” Neves, quoted in November last year.
The airline reported last month a 48 percent increase in its half-year net profit after taxes, and a 38 per cent increase of passengers to 8,7 million. The airline reported full-year profits in 2022, 2023. Neves told Reuters that Etihad is improving transparency, governance, and its balance sheet in order to be ready for a IPO should ADQ choose to list it. Etihad is also facing delays in receiving new planes from planemakers Airbus or Boeing, which has forced some airlines scale back their growth plans.
The travel boom that has occurred since the pandemic is being used by governments in the Gulf to implement reforms in order to diversify their economies. Privatising state-owned assets, such as airlines, is part of the plan. An Etihad listing could add to a flurry in recent years of IPOs.
Bloomberg reported that Flynas Saudi Arabia plans to list by the end of this year. The president of Emirates, a bigger rival, stated in 2021 that the Dubai government is considering an IPO. Flynas wasn’t immediately available for comment.
