Etihad Airways has agreed to sell its stake in Aer Lingus, its chief executive James Hogan has said.
Mr Hogan said that Etihad will sell its 4.99% stake in Aer Lingus, which is in the middle of a potential takeover bid by British Airways-parent International Airlines Group.
The airline's boss also said it had reached a deal to deepen its relationship with Air France-KLM.
Etihad and Air France-KLM will share codes on more flights starting this year, opening more European cities to the Abu Dhabi-based airline's customers.
Mr Hogan made his comments on the sidelines of the International Air Transport Association's (IATA) annual meeting.
The moves announced by its CEO reflect Etihad's strategy to grow its route map through airline partnerships.
With codeshares on French domestic flights imminent, Etihad also is looking to add destinations via codeshares with Philippine Airlines, Garuda Indonesia and Malaysia Airlines, Hogan said.
"We're keen to maintain a relationship with IAG. Indications are that they're interested in doing so too," Mr Hogan said.
Etihad currently lists its flight code on nine Air France cities and 21 KLM destinations.
Mr Hogan said sharing frequent-flier rewards would be the next step in the airline's partnership with Air France-KLM. It has not discussed or considered taking an equity stake in the European carrier, although saying this would never happen is "not possible," he said.
Across the Atlantic, Etihad said it does not have plans to introduce new service to the US for 24 months.
The decision to focus on existing US routes contrasts with competitors Emirates and Qatar Airways, which have announced new flights to seven US cities this spring.
Recent expansion of Gulf-carrier service to the US has caused tensions with US airlines to boil.
US airlines say their Gulf competitors have received more than $40 billion in subsidies from the United Arab Emirates and Qatar, which has allowed them to add excess capacity on key routes, drive down ticket prices and steal market share.
The Gulf airlines deny the claims. Etihad said it is required to repay loans - not subsidies - to its sole shareholder, the government of Abu Dhabi.
