Ethiopian Airlines ‘would consider stake’ in debt-ridden South African Airways

Africa’s most successful airline believes the continent's carriers must do more to address loss of the market to Gulf-based operators
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Ethiopian Airlines, South African Airways, Tewolde GebreMariam, Stake, SAA

Ethiopian Airlines would consider investing in a stake in South African Airways, should the opportunity arise and the carrier decides to sell equity.

Ethiopian’s chief executive, Tewolde GebreMariam, said in an interview with Bloomberg that the group is “interested in supporting” South Africa’s state-owned carrier.

South African Airways is yet to turn a profit in the last eight years and according to reports, the ruling African National Congress has repeatedly said it would consider selling equity.

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Meanwhile, Ethiopian is Africa’s largest and most consistently profitable airline.

Mr GebreMariam confirmed in the interview that the group “would consider” buying a stake in SAA, which is already a partner of Ethiopian through the Star Alliance.

It is thought that a deal between Ethiopian and SAA would alleviate some of SAA’s debts, which currently stand close to $610 million (9.2 billion rand).

As one of just a handful of successful and profitable African carriers, Ethiopian has continually looked to invest in other airlines in the region.

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Mr GebreMariam added: “We have recently signed a shareholders agreement with the Ghanaian government. Hopefully it will be up and running in the next six months.”

Mr GebreMariam believes that home carriers must address the reducing amount of Africa’s market held by companies from the continent.

African operators now hold just 20% of the market, largely because of the growth of carriers from the Gulf, according to Mr GebreMariam.

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