You’re comparing apples with oranges buddy. VA ownership will be 23-26% NZ, 20% SQ and 20% EY. Between them they will own 63-66% of VA. If you include Richard Branson’s Virgin Group then that is 73-76%. In the case of J* Hong Kong it will be 33% owned by the QF group and 33% by MU for a 66% foreign ownership. I find it incredibly hypocritical of you and your boss AJ assuming you work for QF or JQ to think it is OK to try and pull this off in Hong Kong when it is a clear violation of Hong Kong’s constitution, the Basic Law when the fact is that VA’s structure 100% complies with Australia’s foreign ownership laws governing domestic and international airlines based in Australia.
Don't work for any airline, just an interested observer. Have shares in QF and previously had shares in VA.
Couple of points.
HK aviation law is different to Australia - there is no 50% threshold.
Otherwise Cathay Pacific would have no international routes - having historically been >50% owned by the British company Swire Pacific, and now something like 40% Swire (British) and 30% Air China (China) with a v/v share in Air China. So the proposed Jetstar HK has lower foreign ownership (at 66%) than CX. HK law as I basically understand it comes down more to management headquarters, and board location (ie. a control test). Whether Jetstar HK meets this due to the shared services provided by Australia I don't know.
As for VA.
Say I buy a share of the listed Virgin Australia today?
Do I own a piece of the international routes??
- Theoretically no- as the international arm has been grandfathered under the VAIH stucture (per the 23-Feb-12 announcement)
But,
- "both the domestic and international businesses will continue to operate as an integrated airline under one brand."
- the Annual Reports and statements treat Virgin Australia as a single entity (I believe because it is controlled by this entity)
- there are no separate financial statements for VAIH.
So assuming that VAIH (like QFi) is losing money (and probably not unlikely given yields on Transpac routes), if I buy a share today - VA is reporting financials that are not consistent with what I own, the management team is spending time and effort on something I don't own, assuming it is loss making my company is making loans to an entity in which I won't get any benefit.
I have no problem with the foreign airlines owning such a high %ge of Virgin Domestic, but Virgin Australia International should be properly separated, properly reported and properly accounted for, and people should be able to buy shares in it (subject to the 50% cap)