Originally Posted by
markontop
Yes QF was Government owned. Like CBA, TELSTRA etc.
The Labor Government forgave QF debt before it was privatised. I believe you could call this assistance.
A new airline if you like with no debt. Good deal wouldn’t you agree?
The government didn't forgive the debt before Qantas was privatised at all, they converted government guaranteed debt to equity. In that regard it was a balance sheet shuffle that enabled the government to reduce borrowings (the transaction was recorded as negative new money borrowing) by moving debt underwritten for Qantas to an equity position that they then banked when the sale finalised.
And it most assuredly was not a new airline with no debt. The airline carried a total of about $1.3 billion in debt at the time of the sale. That debt had to be refinanced prior to the sale to address change of ownership covenants on much of it. That refinancing required that Qantas have an international credit rating - prior to the sale it had simply relied on government guarantees.
That was another reason for the way the sale was managed in two tranches with a delay between the initial trade sale and the subsequent public float.
The notion being peddled by one of the finance writers at one of the national newspapers that Qantas was given a leg up of some description during the sale process - '
a $1.35bn cash injection from Canberra' - is just risible nonsense.