itchybum
6th Oct 2004, 06:36
Singapore Airlines sells stake in Air NZ
October 6, 2004 - 8:06AM
Singapore Airlines has sold its 6.3 percent stake in Air New Zealand for around $61.7 million, or $1.63 per share, a three per cent discount on the stock's previous closing price.
Air New Zealand was down 3c at $1.65 this morning, after being placed in a trading halt for yesterday's session.
Singapore Airlines' placement agent, UBS, said there was strong institutional demand for the 37.83 million shares from both domestic and offshore institutions.
SIA will book a loss of nearly $500 million on its four-year investment in Air NZ. It paid around $15/share (adjusting for this year's five-for-one share consolidation), for its 25 per cent stake.
Air NZ shares have been in a slump since September 8, when British Airways sold its 18.25 percent stake in Qantas. Air NZ shares had been trading at $1.94 the day before the BA announcement.
There was speculation SIA might be interested in Qantas. SIA's major shareholder, the Singapore government investment agency Temasek Holdings, ended up with three percent of Qantas from that bookbuild.
The BA decision is seen as opening the way for mergers by major airlines in the Asia-Pacific region. Qantas and SIA are in talks to combine maintenance and training for the Airbus A380 planes.
Air NZ's shares have also been pressured over the last month by soaring fuel prices and the High Court ruling against its proposed tie-up with Qantas.
News of the SIA decision to quit Air NZ was leaked to the Australian Financial Review on Monda y.
SIA said in a statement yesterday its decision to sell was "consistent with its strategy to monetize non-core holdings and will not impact on various areas of co-operation between the two airlines, which will continue' '.
SIA had an extremely bumpy ride on Air NZ's share register. Its main purpose in investing in Air NZ was to get into the Australian domestic market through Air NZ's subsidiary, Ansett Australia.
Ansett's collapse in 2001 not only meant SIA had lost hundreds of millions on its investment, but it also lost interest in the kiwi airline.
SIA wanted to bail out Ansett and Air NZ by lifting its stake in Air NZ to 49 percent, but that deal was rejected by the Government. SIA rejected a deal to recapitalise Air NZ whereby it, and then 30 percent owner Brierley Investments, would each inject $150m and the Government $550m. In the end, the Government bailed out the airline on its own with an $885m package that gave the Government 82 percent of the equity and diluted SIA's stake.
NZPA
October 6, 2004 - 8:06AM
Singapore Airlines has sold its 6.3 percent stake in Air New Zealand for around $61.7 million, or $1.63 per share, a three per cent discount on the stock's previous closing price.
Air New Zealand was down 3c at $1.65 this morning, after being placed in a trading halt for yesterday's session.
Singapore Airlines' placement agent, UBS, said there was strong institutional demand for the 37.83 million shares from both domestic and offshore institutions.
SIA will book a loss of nearly $500 million on its four-year investment in Air NZ. It paid around $15/share (adjusting for this year's five-for-one share consolidation), for its 25 per cent stake.
Air NZ shares have been in a slump since September 8, when British Airways sold its 18.25 percent stake in Qantas. Air NZ shares had been trading at $1.94 the day before the BA announcement.
There was speculation SIA might be interested in Qantas. SIA's major shareholder, the Singapore government investment agency Temasek Holdings, ended up with three percent of Qantas from that bookbuild.
The BA decision is seen as opening the way for mergers by major airlines in the Asia-Pacific region. Qantas and SIA are in talks to combine maintenance and training for the Airbus A380 planes.
Air NZ's shares have also been pressured over the last month by soaring fuel prices and the High Court ruling against its proposed tie-up with Qantas.
News of the SIA decision to quit Air NZ was leaked to the Australian Financial Review on Monda y.
SIA said in a statement yesterday its decision to sell was "consistent with its strategy to monetize non-core holdings and will not impact on various areas of co-operation between the two airlines, which will continue' '.
SIA had an extremely bumpy ride on Air NZ's share register. Its main purpose in investing in Air NZ was to get into the Australian domestic market through Air NZ's subsidiary, Ansett Australia.
Ansett's collapse in 2001 not only meant SIA had lost hundreds of millions on its investment, but it also lost interest in the kiwi airline.
SIA wanted to bail out Ansett and Air NZ by lifting its stake in Air NZ to 49 percent, but that deal was rejected by the Government. SIA rejected a deal to recapitalise Air NZ whereby it, and then 30 percent owner Brierley Investments, would each inject $150m and the Government $550m. In the end, the Government bailed out the airline on its own with an $885m package that gave the Government 82 percent of the equity and diluted SIA's stake.
NZPA