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Abu Dhabi’s Etihad Airways to divest several businesses

Etihad Airways will divest several support service businesses to a new aviation company owned by Abu Dhabi state holding firm ADQ and to Abu Dhabi National Exhibitions Company (ADNEC).

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The businesses included in the proposed transaction are Etihad Engineering, Etihad Airport Services Cargo, Etihad Airport Services Ground, Etihad Aviation Training, Etihad Secure Logistics and Etihad Technical Training.

Additionally, the proposed transaction will see two Etihad businesses join Abu Dhabi National Exhibition Company (ADNEC). Etihad Airport Services Catering will combine with ADNEC’s catering business Capital Hospitality, and Etihad Holidays will join ADNEC’s tourism promotion business, Tourism 365.
The proposed agreement marks the start of a new chapter for Etihad Airways, allowing the airline to further sharpen its focus on its core business and respond with greater agility to market opportunities as global travel demand rebounds from COVID-19.
H.E. Mohamed Hassan Alsuwaidi, CEO of ADQ, said: “With the proposed addition of Etihad’s experienced aviation support businesses to our new dedicated aviation company, ADQ is primed to develop an integrated aviation platform that is driven by performance and a robust financial foundation through its new company.”

“With an integrated mobility and logistics portfolio that plays a leading role in the development of Abu Dhabi’s global connectivity, we are well-positioned to unlock the growth potential of these aviation services businesses.”

“We see potential to capitalize on growth opportunities, attract a wider client base of airlines and drive the future expansion of Abu Dhabi’s aviation sector.”
Tony Douglas, Group CEO of Etihad Aviation Group, said: “We’re excited to partner with ADQ on the next stage of our transformation. The past two years have changed the face of aviation and the proposed agreement marks a significant milestone in how we are repositioning Etihad Airways and our subsidiaries for long-term success.”

“This agreement will allow us to place 100 percent of our focus on Etihad Airways to capitalize on recovering travel demand and will benefit our staff, the millions of guests who fly with Etihad Airways every year, and Abu Dhabi’s wider aviation sector.”

“We are working closely with ADQ to ensure the transition is as smooth as possible. With a new, single-minded focus on our airline business, we will continue to deliver on the best-in-class and sustainable travel experience that our guests expect of Etihad Airways.”
Humaid Matar Al Dhaheri, Managing Director and Group CEO of Abu Dhabi National Exhibitions Company (ADNEC) said: “The inclusion of Etihad Airport Services Catering and Etihad Holidays supports Abu Dhabi’s strategy which aims to achieve integration between various business units across exciting economic sectors. This move will enable us to go above and beyond the customers’ expectations by building on what has been done already.”

“Our focus remains on achieving milestones and continuing to work to enhance competitiveness at the regional and international levels, as well as increase contributions to the economy of Abu Dhabi and support sustainable development.”

The businesses joining ADQ’s new aviation company and ADNEC will remain key long-term strategic partners to Etihad Airways.

The transaction is subject to customary closing conditions, including regulatory approvals. The terms of the transaction were not disclosed.

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Russia allows gas flows to Gazprom Marketing & Trading for 90 days

Russia gave permission for natural gas supplies to Gazprom Marketing & Trading Singapore Ltd, part of Gazprom Germania, from Yamal LNG project for 90 days, a government decree showed on Wednesday.
The move comes less than two weeks after the Kremlin said that Russian sanctions imposed on state gas company Gazprom’s former German unit and other entities meant they could not receive gas supplies from Russia.
Germany, Russia’s top client in Europe, in early April transferred Gazprom Germania, an energy trading, storage and transmission business ditched by Russia’s Gazprom, to its energy regulator to ensure energy security.
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Energy ties between Russia and Europe plunged into crisis after Moscow started what it calls “a special military operation” in Ukraine on February 24 and the West responded with sweeping sanctions that put Russia on the brink of recession and a default on external public debt.
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Business

Dieselgate: Volkswagen settles UK emissions class action for £193 million

Volkswagen settled its UK class action lawsuit for £193 million ($242 million) with more than 90,000 drivers impacted by the emissions scandal.

No admissions of liability have been made by Volkswagen and the terms and conditions are confidential, according to a statement from the auto giant.

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A separate contribution toward the claimants’ legal costs and other fees will be made by the company.

Volkswagen alongside law firms Slater & Gordon, Leigh Day and PGMBM, who were representing the claimants in the case, said Wednesday that both sides had come to the out of court settlement and as many as 91,000 claims had been resolved.

The automaker has faced numerous lawsuits in what’s been dubbed the ‘dieselgate litigation’ after the use of the software designed to lower emissions when being tested was exposed as fraudulent by a US investigation in 2015.

That led to a recall throughout Europe that cost the company billions of euros and massive fines from European regulators.

“The settlement is another important milestone as the Volkswagen Group continues to move beyond the deeply regrettable events leading up to September 2015,” Philip Haarmann, chief legal officer of Volkswagen, said.

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Turkey’s lira falls beyond 16.3 vs dollar as FX need grows

Turkey’s lira slid beyond 16.35 against the dollar on Wednesday to its weakest level since the depths of a December crisis, as analysts questioned authorities’ ability to continue steadying it without new sources of foreign currency.

The lira has weakened 9 percent this month and 19 percent this year, despite months of costly interventions in which the central bank has sold dollars to soften the blow and the state has backed an FX-protected deposit scheme.

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The currency dipped as far as 16.3515 and stood at 16.3300 at 1257 GMT, after a 1 percent fall against the greenback.

On Dec. 20, the emerging market currency hit a record low of 18.4 after a series of unorthodox interest rate cuts which pushed it down 44 percent on the year as a whole. In response, inflation has since leapt to 70 percent in April.

The lira held mostly steady early this year due to the government’s scheme, known as KKM, that protects some depositors against lira depreciation. The central bank has also sought to meet the market’s foreign-currency needs since the December crisis.

But those efforts to keep the currency steady have taken their toll on the Central Bank of the Republic of Turkey’s (CBRT) already depleted reserves, according to bankers.

“We estimate that the CBRT’s FX sales exceeded $30 billion in the January-April period,” said economist Haluk Burumcekci, adding that balance sheet data showed sales were more intense in May.

Adjusted for swaps, the bank’s net international reserves fell by another $7.7 billion after the first 20 days of May, he said.

Data last Friday showed the central bank’s net international reserves dropped some $3.5 billion to $11.53 billion in the week to May 13. Bankers calculate that they fell to $10 billion or less in the following week.

Economists say rate hikes could help relieve both the lira and reserves. But President Tayyip Erdogan’s opposition to policy tightening has left few expecting a turnaround any time soon, including when the bank meets on Thursday.

Robin Brooks, chief international economist at the Institute of International Finance, said “intense depreciation pressures” are rising. “We think risk of a severe overshoot – much like in 2021 – is high, given rising global recession risk and the big credit expansion in Turkey,” he said on Twitter.

The war in Ukraine began harming the lira in March as Western sanctions on Russia sent energy prices soaring, pushing up Turkey’s already hefty import bill and fueling inflation.

On Tuesday, the cost of insuring Turkey’s debt against default shot to its highest since the 2008 global financial crisis. IHS Markit data showed 5-year credit default swaps (CDS) had risen to 730 basis points from 704 points.

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