Etihad targets 10% of Virgin Australia

Fast-growing Etihad Airways wants to boost its stake in Virgin Australia to 10 percent, its chief executive said Wednesday, following recent on-market share purchases. In an announcement posted by Virgin on the Australian stock market Tuesday, Etihad said it had built its holding over recent weeks to 3.96 percent. The Abu Dhabi-based carrier needs Australian Foreign Investment Review Board (FIRB) approval to increase its stake above 4.9 percent and chief executive James Hogan said the airline was in talks to do this. "We've certainly advised FIRB that we would like to move to 10 percent," he told The Australian newspaper. "Certainly, we don't intend to become a majority investor. We're keen to have a strong minority stake that strengthens our partnership with Virgin Australia." The two airlines are already part of an alliance which features codesharing on each other's flights, reciprocal frequent flyer recognition and joint bidding for corporate accounts. Etihad has recently been on a buying spree, increasing its stake in Air Berlin to almost 30 percent. It also owns 40 percent of Air Seychelles. Hogan said Etihad would like a Virgin board seat at the "appropriate point in time". Virgin shares were trading around one percent lower at 41.5 Australian cents.