Speculations about Dubai’s flagship airline Emirates’ preliminary talks with Abu Dhabi-based Etihad Airways to acquire the latter continues. According to Bloomberg, four people familiar with the matter said the if the transaction comes through, the new operation will be much bigger than American Airlines Group, which has a market value of $19.2 billion. The Bloomberg report reads: It would create the “world’s biggest carrier by passenger traffic.”
The merger talks underway said to be at a preliminary stage would witness Emirates acquire Etihad, which will keep its maintenance arm, according to sources.
At first, both airlines declined to comment on the matter. For sometime, Etihad has been grappling with pressure to turn a profit and stablise its sinking operations. Likewise, Emirates has had its fare share of suffering during the Gulf slump, but recovered quickly as the oil price and local economies rebounded.
Previously, Emirates Chairman Sheikh Ahmed bin Saeed Al Maktoum and President Tim Clark kept the merger plans low-key. In May, Sheikh Ahmed said there has not been any talks on merger, while Clark said in June that the question should be directed at shareholders; however, there are no plans in the short-to-medium term.