QATAR Airways has upped its holding in British Airways owner IAG to 25.1 per cent after buying an $604m (£465m) stake in the airline group.

The Middle Eastern carrier previously owned a 21.4 per cent stake in IAG, which has seen its share price rise 52 per cent in the last six months.

The move, which is in line with Qatar Airways' policy of building a global group of carriers, is a vote of confidence in IAG, whose chief executive Willie Walsh is due to step down. Walsh was responsible for the creation of IAG in 2011, overseeing the merger of British Airways and Iberia. On stepping down, Walsh will be replaced by current Iberia chief Luis Gallego. The airline group also owns Aer Lingus, Iberia, Vueling and Level.

Qatar Airways has been increasing its investments in other carriers due to a regional dispute which has seen the UAE and Saudi Arabia freeze the Gulf state out of their airspace.

It has minority holdings in Cathay Pacific and China Southern, the former of which recently warned on the threat of coronavirus to its business, as well as a stake in Latam Airlines.

The airline first invested in IAG in 2015 when it initially bought a 9.99 per cent stake, and it has been increasing its holding since then.

Group chief executive Akbar Al Baker said: "Our investment to date has been highly successful and the increase in our shareholding is evidence of our continued support of IAG and its strategy."

IAG shares rose 1.6 per cent yesterday to 642p.

(c) 2020 City A.M., source Newspaper