And Richard Branson tries to blame Chris Corrigan for all of its woes of late, especially seeing that CC has barely had control of
VB for a few months.
Branson must think the general public are idiots if he expects us to believe him.......just like when he estimated that
VB shares were worth something in the order of $2.40 when Corrigan made his $1.90 offer successfully.
Hence this article from today's Australian that puts Branson into perspective:
Patrick blasts Branson comments
Steve Creedy and Blair Speedy
August 24, 2005
CHRIS Corrigan's Patrick Corp hit back yesterday at claims by Virgin Group boss Richard Branson that it was responsible for the airline's fuel woes and its recent profit downgrade. This came as concerns emerged yesterday about the effect Toll Holdings's takeover bid could have on competition in the freight market.
"Richard's comments are laughable, given that he's never attended a single meeting of the board of Virgin Blue," Patrick spokesman Paul White said.
"There never have been, as Richard claims, any strong debates on the issue of fuel hedging as all the board members, including his own representatives, have always agreed the position."
A Virgin Group spokeswoman said the company's two representatives on the Virgin Board had been vocal about the decision not to hedge against fuel price rises.
She said Virgin Blue had hedged before Mr Corrigan took control and the group's other airlines were all hedged.
Sir Richard, founder life president of Virgin Blue, has joined forces with Toll Holdings in a bid to regain his lost influence over the airline and says he disagrees with the way the airline is run.
As well as the hedging debacle - which added $150 million to Virgin's costs and resulted in another profit downgrade last week - he cites delays in taking on Qantas in the business market, introducing a frequent flyer program and moving into freight.
Under the Toll bid, Virgin Group could increase its stake from 25 per cent to 40 per cent by underwriting at $1.40 per share the sale of a 15 per cent stake in Virgin Blue through a bookbuild and taking options.
The war of words continued yesterday as former Australian Competition and Consumer Commission chief Allan Fels warned that Toll's $4.8 billion bid for Patrick could be opposed by the regulator on the grounds that it would shut potential competitors out of the market.
In launching the bid on Monday, Toll managing director Paul Little said he didn't expect any problems getting the deal past the ACCC because there was "minimal overlap" between the assets of the two companies beyond their joint venture rail freight business Pacific National.
But Professor Fels, who was ACCC chairman until 2003, said the regulator would also examine the competition impact of the vertical integration of Toll's road and rail transport assets with Patrick's port operations.
"There appear to be vertical integration issues for the ACCC to wrestle with," he said.
"It can make it harder for new players to enter. They may wish to enter at one level of the industry and then find that they can't get access to the next level of production either upstream or downstream, because their competitor owns it."
The ACCC has already raised concerns over the impact of vertical integration in transport in its analysis of Patrick's proposed takeover of FCL Interstate Transport Services.
The regulator said in June that the merger could raise barriers to entry in the interstate rail freight sector and create an incentive for Toll and Patrick to use Pacific National to keep rival operators from using the rail network.
Current ACCC chairman Graeme Samuel indicated a final decision on whether to allow the Patrick-FCL merger, which has been under consideration since April, could now be delayed while the newer deal is assessed.
"With the two being interconnected, it may be that the outcome of the FCL matter will take into account any possible outcome of the Toll-Patrick matter," Mr Samuel said.
Patrick directors reiterated their rejection of Toll's offer - of 0.4 Toll shares, 75c in cash and 0.3 of Patrick's own Virgin Blue shares for each Patrick share - after a board meeting in Sydney yesterday. The bid valued Patrick shares at $6.87 based on yesterday's closing stock prices, down from $6.95 on Monday afternoon, considering that the offer does not include the 15.5c dividend now bolstering Toll's share price.
Patrick shares closed at $7.25 - a 5.5 per cent premium to the implied offer price - narrowing from the 6.2 per cent premium of a day earlier, suggesting little expectation among investors of a higher bid emerging.