It has been reported that Dubai’s Emirates Airline is in talks to take over Abu Dhabi’s Etihad Airways.

The report by US-based news agency Bloomberg on 20 September says that talks between the two UAE airlines are at a preliminary stage, and would involve Emirates acquiring the main business of Etihad. Etihad would retain its maintenance arm. The report added that the talks may not result in a deal.

Both airlines denied that any talks were taking place, and have in the past said that an airlines operations merger had never been discussed. They have said they could cooperate more.

In May, Emirates chairman and CEO Sheikh Ahmed bin Saeed al-Maktoum told reporters: "A merger is easier said than done, and right now we are of the opinion that competition is good. However there are ways we can work more closely by using each other’s facilities and services."

The two airlines have existing relationships. In January, Emirates Group Security, the security arm of Emirates Airline, signed a memorandum of understanding (MoU) with Abu Dhabi’s Etihad Aviation Group to cooperate on aviation security.

The MoU involves the sharing of information and intelligence between Emirates and Etihad on critical aspects of aviation security.