Etihad Airways today confirmed its equity stake in Virgin Australia Holdings has now reached 10 per cent. This represents 221 million shares which have been bought on the open market over recent months.

Six weeks earlier Etihad Airways received Foreign Investment Review Board (FIRB) approval to increase its holding from 5 per cent to 10 per cent.

James Hogan, Etihad Airways' president and chief executive officer, said: “We are very pleased to have reached this threshold. We support the management strategy of Virgin Australia and will continue to work closely with them on ways to improve our business.

“Our small equity stake reflects the strong working relationship of both airlines and again demonstrates our enduring commitment to the Australian market.

“This further cements our commercial partnership as we continue to explore areas of even closer co-operation such as operational synergies, shared IT infrastructure and other forms of cost sharing efficiency.”

Etihad Airways and Virgin Australia have developed a multi-tiered partnership covering code-sharing on flights, joint marketing initiatives and reciprocal earn-and-burn on their respective frequent flier programs.