(Bloomberg) -- ADQ has picked advisers including Citigroup Inc., HSBC Holdings Plc and First Abu Dhabi Bank for a potential initial public offering of hub carrier Etihad Airways PJSC, according to people familiar with the matter.

Rothschild & Co. is acting as an independent financial adviser to the Abu Dhabi wealth fund, the people said, asking not to be identified because the information isn’t public. ADQ may add more banks later, the people said.

The fund had previously been weighing a direct listing for Etihad instead of a traditional IPO, the people said. A share sale will create the first publicly-traded major Gulf hub carrier and could come as soon as this year, Bloomberg News reported on Friday. The final lineup of advisers may still change. No final decisions have been made on the timing of the sale, the people said.

Representatives for Etihad, ADQ, Citigroup and HSBC declined to comment. Rothschild and FAB didn’t respond to a request for comment.

The airline is working to be ready for an IPO whenever the shareholder decides the time is right, Etihad Chief Executive Officer Antonoaldo Neves said in a CNBC interview this week. Neves didn’t offer any details or confirmation on a potential IPO, saying that the decision was for ADQ.

The Persian Gulf has been in the midst of an IPO boom since late 2021 as governments sold stakes in state-owned firms to fund the transition from fossil fuels, and high oil prices buoyed regional stock markets. International investors have also shown a growing interest in the region.

An Etihad listing would be another example of the United Arab Emirates using its national champions to boost the domestic stock market and to diversify the economy away from oil. Ownership of the airline was transferred to ADQ from Abu Dhabi’s Supreme Council for Financial and Economic Affairs in 2022, part of an effort to boost the sheikhdom’s status as a transport hub.

Travel Rebound

International travel has rebounded since the pandemic, helping global airlines boost earnings, and pushing profit to record levels for carriers. Etihad reported a five fold increase in annual profit this week. 

In neighboring Dubai, an IPO of rival Emirates was considered in 2021 as part of a plan by the business hub to sell stakes in state-owned companies to boost trading volumes. Saudi Arabia’s Flynas, backed by billionaire Prince Alwaleed Bin Talal, is also planning an IPO in the kingdom as soon as this year, Bloomberg News has reported.

Read more: Billionaire-Backed Flynas Taps Goldman, Morgan Stanley for IPO

A listing for Etihad would cap a tumultuous few years for the carrier, which has retrenched from a costly growth path devised more than a decade ago.

Under former Chief Executive Officer James Hogan, the airline bought stakes in smaller, cash-hungry carriers across three continents, with the aim of cobbling together enough passengers to propel the Abu Dhabi-based company into the ranks of the global aviation elite. 

The carrier also undertook one of the biggest fleet expansions in the industry, but has struggled to close the gap with rivals, having been founded in 2003 — 18 years after Emirates and 9 years after Qatar Airways, which operates a connecting hub in nearby Doha.

--With assistance from Leen Al-Rashdan.

©2024 Bloomberg L.P.