Qantas chief to stay
Geoff Easdown
May 19, 2007 12:00am
QANTAS chief executive Geoff Dixon has bowed to board pressure and put off his retirement.
His decision was flagged in a note that formally announced the looming retirements of chairwoman Margaret Jackson, 54, and director James Packer, 39.
Qantas confirmed Mr Dixon and his 20 key managers had responded to individual approaches to stay in their jobs.
Mr Dixon, 67, who is guiding Qantas towards its 14th straight year of profits, gave a commitment to remain until at least July 2009.
While he is already on an open-ended contract, he had said previously he would stay only until July next year.
Mr Packer, Australia's richest man and head of the Publishing and Broadcasting empire, told the board he intended to follow Ms Jackson by not seeking re-election at the November shareholders' meeting.
Mr Packer is a close friend of Ms Jackson.
Her decision was announced at the beginning of the first day of talks on Thursday, thus avoiding the threat of a board rift over the way she had handled the failed $11.1 billion Airline Partners Australia buyout offer.
Senior staff at Qantas were not surprised by Mr Packer's decision to step down with Ms Jackson.
"He was brought to the board by Margaret and was openly regarded as her protege," an airline source said.
"Why would he want to stay for just $100,000 a year in directors' fees when he has bigger things to do at PBL."
Ms Jackson, probably the nation's most prominent businesswoman, paid the price for the Macquarie Bank-led consortium's failed offer.
In a statement yesterday, Ms Jackson said her succession would be the subject of board consideration over the coming months.
She said directors would also have to find a replacement for Mr Packer, who had "served the board with distinction and diligence".
The board discussions, planned as a one-day meeting, dragged on for two days because of the Jackson issue.
In announcing her decision to retire, Ms Jackson said she greatly valued what Qantas had achieved in her seven years as a director.
While the statement listed the eight-point agenda the board addressed during the two-day meeting, no clues were offered as to the board's decisions.
However, it was clear from the statement they were concerned at the emergence of Singapore government-backed Tiger Airways as a domestic rival to Jetstar.
It was also clear from the statement they further refined their plan to restructure Qantas long-haul services by replacing the flying kangaroo on some routes with Jetstar flights that are more profitable.
The meeting also looked at plans to re-equip the Qantas fleet with new Boeing and Airbus passenger jets.
Other discussions centred on plans to consolidate, restructure and rationalise internal systems and supply businesses.
The airline also intends to pursue further cost-cutting and efficiencies through its Sustainable Future Program, which has so far generated savings of almost $2 billion.
Qantas shares closed 3¢ down at $5.22.
Personally, I suspect that Packer resigned so that he could be free to organise another private equity buyout proposal - probably involving Macquarie Bank.