Jet Star on The March
Qantas, Choo Buy 100% of Jetstar Asia; Temasek Sells (Update1)
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By Robert Fenner
April 2 (Bloomberg) -- Qantas Airways Ltd., Australia’s biggest carrier, and Dennis Choo will take full ownership of two Singapore-based low-cost carriers after buying out partners including Temasek Holdings Pte.
Choo, a Singaporean national, will own 51 percent of Jetstar Asia Airways Pte and Valuair Ltd., with Qantas holding the rest, the Sydney-based carrier said today in a stock exchange statement. No financial details were included in the announcement.
The new ownership structure will help Qantas lower costs by better aligning Jetstar Asia with its operations in Australia, the carrier said. Last month, Qantas Chief Executive Officer Alan Joyce cut 90 executive jobs and maintained a salary freeze as the global recession saps travel demand.
Singapore nationals will hold the majority of Jetstar Asia’s board seats and the carrier will retain its traffic rights in the nation.
Chong Phit Lian will stay as Jetstar Asia’s chief executive officer. Choo, who has worked with Qantas for more than two decades, will become chairman of Newstar Investment Holdings Pte, the new parent for Jetstar Asia and Valuair.
Jetstar Asia was previously owned by Orangestar Investment Holdings Pte, whose shareholders included Qantas, Temasek and private investors in Singapore.
Global airline losses may total $4.7 billion this year, almost 90 percent higher than previously forecast, as the deepening recession wipes out $63 billion of revenue, the International Air Transport Association said last month.
To contact the reporter on this story: Robert Fenner in Melbourne