Etihad buys Aer Lingus stake in new European airline move by Abu Dhabi

Abu Dhabi yesterday threw more cash into European aviation when its flagship airline Etihad bought a 3 per cent stake in the Irish carrier Aer Lingus for about €15m (£12m).

The Middle East country, which owns Manchester City FC, raised its stake in Air Berlin to nearly 30 per cent from just under 3 per cent in December, paying €73m in cash and €255m in lending.

That saw Etihad beat rival Dubai-owned airline Emirates to receive a code-share agreement giving it access to Air Berlin's European short-haul network.

Now, after months of speculation about a more formal tie-up with Aer Lingus, Etihad has bought a stake in the Irish flag carrier. Etihad's chief executive James Hogan said his airline was interested in talks with the Irish government over its 25 per cent stake in Aer Lingus.

Etihad is trying to gain routes and market share quickly to catch up with the likes of Emirates and Qatar Airways.

However, it is not expected to raise the stake in Aer Lingus unless the two airlines agree a code share.