Qatar Airways increased its stake in IAG after shares in the British Airways owner lost about a quarter of their value in the post-Brexit rout.
The Doha carrier increased its stake in IAG to 20.01 per cent from 15.67 per cent, but said it had no plans to raise its holding further unless the situation changed materially.
Qatar Airways said its interest in IAG was purely financial, but also reflected the strength of the commercial and strategic ties between the companies.
"The recent market valuation of one of the world's leading airline groups has provided, what we believe is, an attractive opportunity to increase our shareholding in IAG," said Akbar Al Baker, the group chief executive of Qatar Airways. "We continue to be highly supportive of IAG's strategy and management team."
Non-EU shareholders of IAG, including Qatar Airways, are subject to an overall cap on non-EU ownership as a result of the requirement for EU airlines to be majority owned by EU shareholders.
Britain voted to leave the European Union on June 23, triggering a sharp decline in airline shares as investors bet the weakening pound would encourage more holidaymakers to stay at home.
As of late yesterday afternoon, IAG had lost 23 per cent of its stock market valuation since the vote.
Qatar Airways has also been increasing stakes in other global carriers. Last month it agreed to buy as much as 10 per cent of Chile’s Latam Airlines and 10 per cent of Meridiana, the Italian carrier.
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