In a stark follow up to the earlier Qatar news today (that they might be buying Malaysian Airlines), Qatar has denied that they are buying Turkish Airlines.
This comes as several news stations reported that Qatar had secretly bought a 49% stake in the Euro-Asian airline for $10.5bn.
What are the details?
This whole story began back in September last year, when Qatar gifted a royal family VIP aircraft to Turkey to serve as the Prime Ministers jet. President Recep Tayyip Erdoğan accepted the Boeing 747 from Qatar, and within the same week, took control of the Turkish sovereign wealth fund (kind of like the state treasury).
This fund is the owner of the national carrier Turkish Airlines and therefore can decide who owns what. With Turkey being in a recession, a quick sale for a few billion would be an excellent way to prop up the economy.
As such, many believed that a deal was in the works and this ‘gift’ was more like a downpayment from Qatar. In fact, Qatar recently invested $15 billion into the Turkish Lira, helping the currency increase in value.
Regarding Turkish Airways, rumor has it that Qatar has bought 49% of the airline for $10.5bn. Turkish Airlines has yet to officially address these rumors, although those close to the matter were quick to comment.
The news reports about a sale of Turkish Airlines that surface from time to time have no basis in reality. We wish to respectfully inform the public that we reserve our legal rights about these baseless speculations.
— Yahya ÜSTÜN (@yhyustun) 20 March 2019
Turkish Airlines will need to issue a formal statement soon, as 51% of its shares are traded on the local stock market.
Why would Qatar be interested in Turkish Airways?
One of the main questions that many have raised is why would Qatar be interested in Turkish Airlines? After all, are they not close on the world stage and would simply cannibalize their own sales?
Well for one, Turkish Airlines would certainly help with the Qatar blockade. Currently, Qatar aircraft can only fly on the most narrow strip of airspace out to international waters in the Gulf. This strip can sometimes be as narrow as 10km, with aircraft forbidden to fly inland to Saudi Arabia or the UAE. But a foreign airline, say from Turkey, would be allowed to fly anywhere. Qatar could clearly leverage sjch a partnership and request codeshared routes using these aircraft.
Additionally, Turkish Airlines is a very good investment. They are a large, modern airline with a fantastic service offering. Their fleet and soft product would compliment Qatar nicely. Some would say the airlines are almost too close when it comes to products, and if they were partners (or Qatar owning the other) they could plan their routes around non-interference.
What do you think? Should Qatar buy Turkish Airlines or has it already happened?