Abu Dhabi: Adel Ali, Chief Executive Officer of Air Arabia, said on Sunday that the airline’s latest acquisition of stakes in Jordan’s Petra Airlines was fully funded by the company’s own capital, without the need to resort to banks or the stock market.
The Sharjah-based airline is listed on the Dubai Financial Market, but Ali said that sale of shares did not contribute to the 49 per cent acquisition of Petra, which has been relaunched as “Air Arabia Jordan”.
Speaking to Gulf News on Sunday, Ali said that Air Arabia is “very cash-strong” and that the deal was not a challenging one given the company’s finances.
He declined to reveal the value of the deal saying that they had agreed with the sellers not to announce the value.
As for routes, Ali said that Jordan’s geographical location between the Middle East and Europe will provide potential to fly anywhere. He said the airline will fly to a number of Middle Eastern airports, and will look into various cities in Europe and North Africa.
The CEO was speaking on the sidelines of the Future Air Transportation System Summit, which is currently held in Dubai.
Discussing the acquisition, Ali confirmed his confidence in Jordan’s geopolitical stability, after the company had delayed earlier plans to launch a hub in Jordan due to the Arab Spring and the global financial crisis.
Geopolitical situation
“It was a combination of coming out from a global financial recession, and going into the Arab Spring where one was not sure what was happening. I think there’s much more clarity in the geopolitical situation. We see Jordan as a safe, advance business model, and we’ve always had interest in the place to do business,” he said.
Asked whether passengers can expect to see lower ticket prices as a result of falling oil prices, Ali said, “We’ve always had a fuel surcharge. When the fuel [prices] are not high, we take off the surcharge, so we have not the fuel surcharge for quite a number of months now. We do not plan to add it so long as the fuel is still priced in this range or if it goes to $80 or $90.
The fuel surcharge comes in place when [prices] go above $100 [per barrel].”
