By Joanna Plucinska
BRUSSELS (Reuters) - Latvia's airBaltic, which is aiming to float on the stock market at the end of this year or in 2025, could see itself as part of a larger airline group when it has built up enough scale, its CEO told Reuters.
"It could well be when we are large enough that it makes sense to be part of a group," Martin Gauss said.
"We have just ordered 30 more (aircraft) and have an intention to go to 100 aircraft, I would say in the years 2030, 2032. When we have or exceed 100 aircraft, we have a size where a larger group will say how 'would that fit in?'" he said.
AirBaltic ordered 30 Airbus A220-300 aircraft last year and has 20 purchase rights. It currently operates 50 aircraft, Gauss said.
However, he added airBaltic wasn't looking to be bought at the moment and was focused on launching its initial public offering.
"We're doing okay; we came very well out of the crisis, ... we want to do an IPO ideally at the end of this year or next year and then fix our equity issues," he said in an interview.
State-owned airBaltic posted its highest ever profit of 34 million euros ($37 million) last year, as airlines benefit from a post-pandemic surge in travel, but it is also striving to cut debt, with about 200 million euros due within six months.
Europe's airline industry has been gradually consolidating for the last 20 years but remains fragmented, with small national carriers struggling to compete with bigger rivals.
Ongoing deals include Lufthansa's bid for ITA Airways, currently being examined by EU regulators, and Air France-KLM (LON:0LN7)'s bid for a stake in Scandinavia's SAS.
Gauss said joining a larger group had benefited smaller airlines in the past, citing Swiss Airlines.
"That airline benefits from being in the Lufthansa Group tremendously. They are today their cash cow with a premium service ... while when Swiss was alone they couldn't manage," he said.
"So I think that is a story I really like ... I'd like to be the Swiss or Iberia," he added, referring to the Spanish airline that is part of IAG (LON:ICAG).
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