Qatar Airways seeks 10 pct stake in American Airlines

American’s incorporation documents also prohibit anyone from buying more than 4.75 percent of the company’s stock without advance approval from American’s board of directors.Despite its plush cabins Qatar Airways is tiny compared with American and other competitors.”Qatar Airways sees a strong investment opportunity in American Airlines”.American seemed keen to stress what would not change, regardless of the outcome of this unsolicited bid.”We aren’t particularly excited about Qatar’s outreach”, the CEO wrote in a memo to American employees.And while Qatar, along with Emirates and Etihad, has invested in other carriers – Etihad, for example, has a large stake in ailing Alitalia Airlines – an investment in a US carrier likely will spark a strong response.The carrier added that it remained committed to pursuing fair competition with Gulf-based airlines. “Long term, Qatar might view this investment as a stepping-stone to more access to the U.S”. A 10pc stake would place Qatar Air among American’s largest shareholders, along with Warren Buffett’s Berkshire Hathaway.Some have suggested Akbar Al Baker is trying to soften American’s lobbying in Washington. Other awards doled out include the Best Airline in North America, which went to Air Canada; Best Airline in Europe (Lufthansa); and Best Low-Cost Carrier (AirAsia).”The U.S. market is strategically important to Qatar Airways and this would strengthen their ability to feed at the U.S. end”, independent aviation consultant John Strickland told Reuters.American, Delta, United and their labor unions were unable to get the Obama administration to accept their accusations that the Middle East airlines receive illegal subsidies.Travel to the United States has been slumping in recent months for a range of reasons, including Trump’s attempts to enact a travel ban for citizens from some predominantly Muslim countries. “So there is no possibility that Qatar will be able to purchase enough of American to control or influence our Board, management or our strategy”. The move comes as the state-owned airline looks to expand its presence in the United States.Earlier, the Allied Pilots Association, which represents American’s pilots, blasted the offer. It has obtained stakes in International Consolidated Airlines Group, Meridiana and LATAM Airlines Group SA (ADR) (NYSE:LTM) over the last few years. It owns just over 20 percent of IAG, which also controls European carriers Aer Lingus, Iberia and Vueling. And foreign ownership laws would prevent it from buying more than 24.9%.