Seychelles government, Etihad Airways in new strategic partnership as Air Seychelles Ltd.

The Government of Seychelles and Etihad Airways, the national airline of the United Arab Emirates, have signed a Memorandum of Understanding wherein Etihad will invest to acquire a 40 per cent stake in Air Seychelles Ltd as part of a strategic partnership alliance initiative between Air Seychelles and Etihad Airways.

The deal was announced today by Joel Morgan, Seychelles Minister of Home Affairs, Environment, Transport and Energy and James Hogan, President and Chief Executive Officer of Etihad Airways.

Etihad Airways' investment of USD 20 million will be matched by an equal capital injection from the Government of Seychelles. In addition, Etihad Airways will also provide a shareholder's loan of USD 25 million to meet working capital requirements and support network development.

Mr Morgan said: "This is a game-changing strategic partnership for us, establishing Air Seychelles on a sustainable growth trajectory and offering a realistic way forward for long-term commercial growth."

"The partnership simultaneously provides international presence, strategic penetration and a bright future for our national carrier."

"The aviation industry is under enormous pressure right now, with small airlines especially vulnerable to global economic instability and ongoing oil price volatility. In this context, consolidation offers the best possible solution for Air Seychelles. This agreement will allow Air Seychelles to share the benefits of the visionary strategy of one of the world's leading airlines and leverage its economies of scale and synergies."

Mr Hogan said: "This deal is consistent with our approach to expansion, which relies on the strength of strategic partnerships across the globe. The investment in the national carrier of Seychelles is a natural next step towards growing our operations in the increasingly important leisure markets of the Indian Ocean and Africa.

The partnership simultaneously provides international presence, strategic penetration and a bright future for our national carrier