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Emirates says IPO is a possibility for popular long-haul carrier

DUBAI, United Arab Emirates –

The president of long-haul airline Emirates said on Tuesday that the Dubai-based airline’s initial public offering could happen as the city tries to boost local financial markets. and promises that its fleet of iconic double-decker jets will soon see the skies once more.

Meanwhile, European aircraft maker Airbus secured more orders on the third day of the Dubai Air Show, reaching a deal worth more than $3.3 billion to sell 28 new planes to customers. Jazeera Airways of Kuwait. Chicago-based manufacturer Boeing has yet to announce a major sale at an show important to the Mideast’s East West travel hubs.

Tim Clark of state-owned Emirates told reporters at the air show that the proposal to sell Emirates shares “has been put forward” after his boss, Emirates Chairman Sheikh Ahmed bin Saeed Al Maktoum , comment on this possibility.

The city-state this month announced plans to list the state-owned electricity company and other government-backed companies to increase liquidity and expand the local Dubai Financial Market so it can compete. compete with larger regional partners. The market has also seen major players go private in recent months, as well as a fraud investigation targeting a major Dubai-listed property developer.

Clark describes Emirates, long the crown jewel of the state-linked companies that make up what analysts call “Dubai Inc.”, as attractive to future investors.

“The pandemic has pushed us back, but as you know, Emirates’ profitability is a well-known fact,” he said. “We’re going to restore that in the next six, eight months. We’re on the way to doing that.”

Since the pandemic hit, Emirates has grounded dozens of iconic Airbus A380 double-decker jets, many of which can be seen from the runway at the Dubai Air Show. The airline has burned through $7.1 billion over the past half year, forcing it to receive nearly $3.8 billion in cash aid from the Dubai government.

Getting 120 A380s back into the skies is key to Emirates’ recovery, and Clark said the airline has to settle the debt owed to them. He was blunt about the value of planes to Emirates, noting that 80% of its profits came from pre-pandemic planes.

“To have a $450 million airplane sitting on the ground doing nothing for two years is a challenge,” he said, adding, “When the border reopens to us, absolutely no Is there any reason we shouldn’t expand…Once we’re back to the way we were, we’ll grow again.”

Trade shows in Dubai often see a flurry of order and product announcements. But this year’s show, in the shadow of the coronavirus pandemic causing the airline industry’s worst-ever crisis, has softened. Most of the deals involve small planes, as opposed to the wide-body brands that specialize in long-haul routes by Gulf Arab airlines.

Airbus’ biggest sale of the day includes 20 single-aisle A320neos and eight A321neos, which compete directly with Boeing’s 737 Max, along with an option to sell another five planes to the low-cost carrier, which is currently underway. Kuwait’s fast-growing.

While executives describe the deal as a memorandum of understanding rather than a firm imperative, Rohit Ramachandran, CEO of Jazeera Airways, said he considers the handshake “far beyond any official collateral” behind the agreement.

“There is a great degree of confidence that, frankly, one can determine a substantial dollar value,” says Ramachandran.

Kuwait-based Jazeera Airways, an emerging discount airline in the Middle East, was founded in 2004 as one of the first government-owned airlines in the Persian Gulf.

Airbus also said it had received an order for 10 narrow-body A220 jets from Nigeria’s Ibom Air, a new airline owned by the oil-rich southeastern state of Akwa Ibom. Based on the aircraft manufacturer’s pre-pandemic price list, the deal is valued at about $810 million. The executives declined to say how much they had to pay for the planes.

The announcements follow other Airbus orders during the first two days of the show, with 111 new aircraft sold to Air Lease Corporation and 255 new aircraft to various low-cost carriers by Indigo Partners. . The purchase signaled executives see a ravaged industry recovering from the pandemic, with travel demand expected to increase in the coming years.

The trade show often pits France’s Airbus and US rival Boeing, the two manufacturers at the top of the supply chain, against each other in the vital Mideast market filled with long-haul carriers connecting East and West. .

Meanwhile, Emirates announced that by the end of next year, it will begin retrofitting its 105 wide-body aircraft, including the Boeing 777 and the superjumbo A380, with a new cabin class called Premium Economy , offers more space than passenger cars but lower fares than business class. class.

At the air show, Mohammed bin Zayed Al Nahyan, Crown Prince of Abu Dhabi and de facto leader of the country, met a delegation of Russian defense industry officials at the vast booth of Edge, the industrial company. homegrown military of the United Arab Emirates.

Their discussions come as Russia promotes its Sukhoi Su-75 Checkmate fighter jet at the air show – the jet’s first demonstration outside of Russia. The UAE has been trying to buy Lockheed Martin F-35 stealth fighter jets since it formally recognized Israel last year in a deal brokered by the Trump administration.

That big arms deal has slowed down under President Joe Biden. But a senior US official overseeing arms exports told The Associated Press on the sidelines of the conference that the US remained “fully committed” to the proposed sale of F-35s to the UAE.

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Associated Press journalist Malak Harb in Dubai, United Arab Emirates, contributed to this report

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