Abu Dhabi’s Etihad Airways is considering deferring its $1 billion IPO to the first quarter of 2026, allowing the UAE airline to capitalise on its recent partnerships, a source with knowledge of the matter reported to Zawya.
These agreements include a JV with Ethiopia inked in March and another with China Eastern Airlines in April. The carrier has also accelerated its network expansion after the announcement of Wizz Air’s decision to cease operations in Abu Dhabi from September 1.
“Etihad has done well signing JVs with partner airlines this year, and it now needs to deliver on these for its investors. While coming to market is not an issue, it just makes better business sense to push the IPO to early 2026,” the source said.
Etihad is fully owned by the UAE wealth fund ADQ, and the airline’s CEO, Antonoaldo Neves, has maintained that the decision to go public ultimately lies with its shareholder.
Zawya reached out to Etihad, but no comment was available at the time of publication.
The imposition of US-led tariffs, followed by a sudden flare-up in Middle Eastern tensions, had given markets pause, but Etihad’s decision to defer its listing from H1 2025 was largely led by its growth strategy, the source said.
“Etihad is a national airline, with a shareholder that is not value sensitive. It wants to go public when there’s a clearer story to map out its growth. You want to bring it [IPO] at the most opportune time, with market conditions that are 100% and will benefit the decision,” two banking sources familiar with the matter said.
Growth plan
Hungarian low-cost carrier Wizz Air’s announcement this month has also created a market gap that could prove to be a lucrative opportunity for Etihad to capitalise on in the immediate months that follow, said analysts.
Nishit Lakhotia, Group Head of Research at Bahrain’s Sico Bank, said Wizz Air’s decision to leave Abu Dhabi is an opportunity for Etihad to leverage its position as a market leader at a time when several airlines in the region have faced turbulence over repeated route cancellations and airport closures stemming from escalating geopolitical tensions.
“The total profitability of regional airlines last year was at record levels, and while some geopolitical challenges did affect Q2, the broader theme remains intact, and an Etihad IPO should ideally be on the cards,” said Lakhotia.
Etihad has expanded rapidly after ownership was transferred to ADQ in late 2022, revising its growth target to carry 38 million passengers by the end of the decade, up from the previous goal of 33 million.
In May, the airline reported a profit of 685 million UAE dirhams ($186.5 million) for the first quarter of 2025, up 30% year-on-year, driven by strong demand and efficiency gains. Fleet expansion has been a key focus of its $7 billion investment plan.
Yet some say market sentiment towards aviation stock remains cautious following the muted performance of Saudi Arabia’s budget carrier Flynas in June, as escalating tensions between Iran and Israel led to the closure of several airports and restricted airspace across the region. Despite being one of the biggest IPOs of the region at $1.09 billion, the airline’s stock closed over 3% lower on its debut.
John Strickland, an aviation analyst and the director of London-based JLS Consulting, observed that while there may be market sensitivity about investing in airlines currently, it would not present a hurdle to future listings in this sector. Strickland sees Etihad’s IPO going ahead soon.
Bloomberg reported earlier ADQ had picked advisers including Citigroup, HSBC Holdings, and First Abu Dhabi Bank for the IPO.
