Etihad buys 70% stake in airberlin’s flyer programme
DUBAI— Etihad Airways, the national airline of the UAE, has acquired a majority stake in airberlin’s frequent-flyer programme, the former announced on Tuesday.
The move comes a year after the Abu Dhabi-based carrier bought a 29 per cent of airberlin shares and agreed to grant up to $255 million in loans to Germany’s No. 2 airline.
“Through revenues generated, and cost saving initiatives, Etihad Airways has already recouped its initial investment of $105 million [in airberlin],” James Hogan, Etihad Airways’ president and chief executive officer, said in a statement.
James Hogan and Hartmut Mehdorn at a press conference in Berlin on Tuesday. — AFP
Airberlin expects cash proceeds of more than $242 million from the sale of the 70 per cent stake in its topbonus programme that will help the carrier to post its first annual profit since 2007.
The new entity will become part of a new loyalty management company being established by Etihad. This company will allow the carrier and its partners to target the fast-growing, profitable global loyalty management market more effectively. “This new investment creates an excellent growth opportunity for us to capitalise on the loyalty management market, while offering a greater range of benefits to passengers from multiple partner airlines,” Hogan said.
The loyalty programme sector is a faster growing and higher margin business than the airline industry, he said, adding: “This new approach allows both our companies to reap greater rewards together, with opportunities to generate sustained profits from our loyalty programmes.
Hartmut Mehdorn, airberlin’s chief executive officer, said: “This is a fantastic deal for our customers, offering new opportunities for them to collect topbonus miles around the world and redeem them in the most effective way.”
The year-old partnership between airberlin and Etihad Airways has separately allowed the carriers to deliver more than 300,000 passengers onto each other’s networks and collectively generate more than €100 million.
At a news conference in Berlin on Tuesday, Mehdorn and Hogan spoke about the range of initiatives which could bring further cost synergies and savings to both airlines.
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