Wed "The Australian" 7/8/02
Qantas persists on foreign bid
Steve Creedy, Aviation writer
August 07, 2002
QANTAS chief executive Geoff Dixon yesterday attempted to salvage the airline's failing bid to lift foreign ownership limits by arguing such a move would boost the airline's ability to service regional Australia.
Mr Dixon also said changes to the Qantas Sales Act would not affect the airline's icon status.
Qantas shares fell 6c yesterday after The Australian revealed that the federal Government was poised to reject its request to lift the 49 per cent ceiling on foreign investment.
Senior ministers agree that the Qantas case has some commercial merit but, with risks the carrier could end up in foreign hands, they remain concerned about the political fallout as the Government moves to privatise Telstra.
Mr Dixon said it would be extraordinary if opportunities for growth were curtailed by short-term concerns about a further selldown of Telstra.
He denied the airline would become foreign-controlled or that it would lose its Australian icon status if the act were changed. "Qantas would remain an Australian company with an Australian board and headquarters, operating out of Australia and employing tens of thousands of Australians," he said.
"Foreign investors, including foreign airlines, would not be allowed to control Qantas. This would ensure that Qantas continues to satisfy the requirements of bilateral agreements that allow it to fly to other countries."
Qantas argues the foreign ownership limits are restricting the airline's ability to reach its full potential, imposing an artificial ceiling on its share price and increasing its cost of capital. It believes the Government should rely on the Foreign Investment Review Board to determine what is in the national interest