While it may be flattering to receive an unexpected romantic overture, such moves are not always greeted with excitement. That could be the case for American Airlines, which revealed that it has received an “unsolicited notice” from Qatar Airways indicating the carrier’s interest in buying a large slice of American. Considering American’s past criticisms of the Gulf airline’s rapid growth, this attention may not be welcome.
In a filing with the U.S. Securities and Exchange Commission [PDF], American said Qatar Airway’s notice says it’s intending to make a “significant investment” in the airline.
“The notice advised that Qatar Airways intends to purchase at least $808 million [in common stock] and, in a conversation between the CEOs of the two companies initiated by the Qatar Airways CEO, Qatar Airways indicated that it has an interest in acquiring approximately a 10% stake,” American says in the filing.
American says that Qatar Airways also submitted a filing required under the Hart-Scott-Rodino Act, which is necessary for any acquisition of more than $81 million in common stock.
The airline says it will respond “in due course with the appropriate filings required under the HSR Act.”
Though American doesn’t come right out and say it’s against any such acquisition by Qatar Airways, it reiterates again that the proposed investment was not not solicited by the company, “and would in no way change the Company’s Board composition, governance, management or strategic direction.”
Any party that wants to acquire at least 4.75% of American’s stock would have to receive approval from the airline’s board, the carrier said, but it hans’t received any such notice to that effect.
American also says it believes the current administration will “stand up to foreign governments to end massive carrier subsidies that threaten the U.S. aviation industry and that threaten American jobs.”
In the past, executives at American have expressed concern over Qatar Airways’ power in the airline industry, notes Bloomberg, after it used its geographical position on the Persian Gulf to build a transfer hub for rich long-haul passengers traveling the world.
“What’s really concerning is the fact they’ve begun flying to places outside the Gulf to the United States,” Chief Executive Officer Doug Parker said in an interview June 16. “They are growing with wide-body aircraft at a rate no one has seen before and not just today because they have more airplanes coming. It’s a serious concern to us. One, we don’t think its fair and two, it’s a huge risk to U.S. commercial aviation.”
American declined to comment beyond the filing. Consumerist has reached out to Qatar Airways for further comment and will update this post if we hear back.
by Mary Beth Quirk via Consumerist
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