Etihad Airways is preparing to list on local markets this year. It will be the first IPO by Gulf carriers for nearly two decades. Etihad is contacting investors in the coming week before a potential sale around a 20% stake, according two sources.
Etihad will list this quarter, according to people familiar with its plans. One of them said that the airline would be targeting both local and foreign investors.
One of the two sources and a third said that it could raise up to USD 1 billion, making it the first airline IPO since Kuwait’s Jazeera Airways IPO in 2008.
One person familiar with the plans for flynas in Saudi Arabia, which is backed up by Kingdom Holding, an investment company run by billionaire prince Alwaleed Bin Talal.
Qatar Airways, a major airline in the region, may go public within the next decade. The plans are secretive, so the four people did not want to be identified. Etihad and its owner, Abu Dhabi’s sovereign wealth fund ADQ declined to comment. Flynas didn’t respond to a comment request.
Kingdom Holding CEO, Prince Alwaleed, told Saudi state-owned Al Arabiya TV that the company is in the final stages of getting approval from Saudi market regulators to list in Riyadh. Prince Alwaleed announced on X in early October that Flynas was worth at least USD2 billion.
Dubai’s Emirates was also flagged previously as a possible IPO candidate. Sheikh Ahmed bin Saeed Al Maktoum, the chairman and chief executive of the company, told reporters last year that he was not in charge of making a decision about an IPO. Instead, he said that it would be a decision made by Dubai government and if he were asked to proceed with one.
Potential listings are partly driven by local governments’ attempts to diversify their economies and move away from oil. They are betting on sectors such tourism, as international travel is reviving after the pandemic. Aviation analyst John Strickland noted that the IPOs could provide investors with a market that has significant growth potential. This is due to the geographic location of Europe and Asia as well as Dubai’s popularity as a tourist attraction.
Dubai is a major stopover for long-haul flight after it overtook Heathrow as the busiest international airport in the world a decade ago. Etihad has undergone a multi-year restructure and management shake-up, after investing billions to compete more effectively against Gulf peers by purchasing minority stakes in another carrier.
The launch of the multi-billion dollar new terminal at Abu Dhabi’s Zayed International Airport, in 2023, tripled the hub’s annual passenger capacity to 45 millions passengers and could aid the airline’s growth plans. Etihad said it is expanding destinations to more 125 airports from more than 90 airports today by 2030 and boosting its fleet as part of a plan that aims to strengthen the role of Abu Dhabi’s capital as a hub connecting Asia and Europe.
Mohamed Ali Yasin said:
“Markets have a vibrant feel, and valuations for regional companies are high.”
The Oracle Financial Consultancy and Investments is an investment consultancy.
Flynas, a Saudi Arabian airline that has been in business for nearly 20 years, plans to expand its fleet from 60 aircraft to over 160 by 2030. Strickland noted that flynas, despite local competition such as low-cost player, flyadeal has the credentials for growth.
According to IATA, the Middle East had a 9.4% share of the global market for air passengers in 2023, calculated in terms of revenue per kilometre. In November 2024, the demand was 8.7% higher than it was a year ago. IATA data shows that other regions still account for larger shares in the overall market. Asia Pacific tops the list, with a share of 31.7%.
According to LSEG, the Gulf accounted for a majority of the 54 IPOs that took place in the Middle East, North Africa, and Asia in 2024. These IPOs raised USD 12,2 billion, an increase of 12 per cent compared to a year ago. The Gulf listings may be a bright spot in the airline sector, which has been plagued by problems in other regions.
Strickland noted that some Gulf carriers were among the first to recover and restart the market after COVID. Europe is bound up in regulation and climate change focus.