Qatar Airways Eyes 20% Stake in Virgin Australia

In a strategic move to expand its footprint in the Australian aviation market, Qatar Airways is in advanced talks to acquire up to a 20% stake in Virgin Australia, according to multiple sources. The potential deal, which could be announced as early as next week, underscores the ongoing battle for market share against dominant carrier Qantas.

Virgin Australia, currently owned by U.S. private equity firm Bain Capital, had initially planned a A$1 billion ($665.5 million) public listing on the Australian Securities Exchange. However, this plan has been delayed. A successful stake acquisition by Qatar Airways would require approval from the Foreign Investment Review Board, and it remains uncertain whether the Australian government will endorse the transaction due to protectionist policies favoring domestic airlines.

This move comes amid a complex relationship between Qatar Airways and the Australian government. Previously, Qatar Airways’ attempts to increase its presence in the Australian market were blocked by the Labor government. Despite this, Qatar Airways and Virgin Australia have maintained a partnership since 2022, including a codeshare agreement and reciprocal loyalty benefits.

The acquisition could offer Qatar Airways several strategic advantages. It might enable Virgin Australia to advocate for increased access for Qatar Airways within the Australian market. Additionally, Qatar Airways could potentially provide Virgin Australia with wide-body jets, facilitating the launch of new long-haul routes to Doha, thereby circumventing existing restrictions on Qatar Airways’ service to Australia.

This development follows historical context where Qantas, despite being in the same oneworld alliance as Qatar Airways, has favored its partnership with Emirates and has actively resisted Qatar Airways’ expansion in Australia.

As the aviation industry watches closely, the outcome of this potential stake acquisition could significantly reshape the competitive dynamics in the Australian market, offering new opportunities for growth and cooperation between the involved airlines.