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View Full Version : Qantas hungry for foreign airline stakes (Geoffrey Thomas)


Wirraway
23rd Feb 2003, 14:37
Mon "Sydney Morning Herald"

Qantas hungry for foreign airline stakes
By Geoffrey Thomas
February 24 2003

Qantas has flagged that it could be on the takeover trail if the Iraqi war erupts and the conflict brings airlines to their knees.

Mr Dixon warned that the Iraqi conflict would lead to consolidation in the industry and that Qantas would be well placed to take advantage of it.

Airline analysts said yesterday Qantas could be targeting a 25 per cent stake in Oneworld alliance partner American Airlines.

"If there was a war in Iraq, I believe we will have failures of airlines and the inevitable consolidation that must be necessary in an industry that has such high people and capital costs will happen," Mr Dixon told Nine's Business Sunday program.

He said the aviation industry was in chaos, as hundreds of thousands of people were losing their jobs, planes were being stored, US airlines were insolvent and there was trouble in Europe. Qantas would be poised to take advantage of the situation after announcing a record interim profit of $352.5 million on Thursday.

"Perhaps we will be in the position to be able to look at whether there is potential opportunities out there - not people looking at us whether we are a potential opportunity," he said.

For some time Qantas has been eyeing equity buys in foreign airlines and could take as much as a 25 per cent equity in American Airlines under current US legislation.

In the past two years, American Airlines' stock has fallen from $US40 to just $US2.91 on Friday. American has 155 million shares on issue and a 25 per cent stake would cost Qantas $US113 million ($191.5 million) - a fraction of what American Airlines is worth in normal times.

However, any such investment would only be struck after American had renegotiated with its unions for substantial pay cuts more in line with industry standards for lower cost airlines such as Southwest of the US.

The West Australian
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Pic Qantas 767-200 VH-EAQ on taxi to rwy 19 BNE.
http://www.jetphotos.net/viewphoto.php?id=1329
Photo: Wirraway (Ian Sharp)

Buster Hyman
25th Feb 2003, 04:42
It's probably just me, but does anyone else have issues with a company, who's entire growth strategy is dependant on the "suffering" of others?:confused: I'm suprised Murdoch doesn't run it.:rolleyes:

rockarpee
25th Feb 2003, 09:30
Buster, its just business. I'm ex gen av. and it was tougher there.

frank Borman
25th Feb 2003, 22:40
No Buster, what you have is a company that has had a fair amount of government support wanting more government support because they can see the writing on the wall. You don't have to be blind freddy to see that it's Qantas's realisation that VB and SQ are gaining momentum in equity partnership talks at the behest of Corrigan thats causing them consternation.

At the end of the day, Qantas is getting whats coming to them. It was OK for Dixon, Max Moore-Wilton, Howard and Anderson to ruin AN, but now, when the threat of SQ is looming, Dixon throws his little guilt trip paddy sessions to the government.

Nup, sucked in I say, the monopolistic, rude, arrogant, whinging, scheming, Dixon can get his just deserts out of this one. You may be tough Geoff, but you are no match for an SQ invasion via VB with the associated several billion $ war chest that comes with it.

And on another note, great to see when QF did their last run of deals in Canberra with public service departments. The bargaining tool was, "if you departments don't use QF link for your regional flying, then you won't get your discounts on domestic and international flying"

Do you condone that one Geoff? you don't like regionals like REX getting a slow increase in pax numbers do you? probably not a good idea for QF staff to say that to people, after all, if it got leaked in the press that departments were favouring QF regionals, then the $5 million loan to REX to get started was a waste of money wasn't it.

Can you feel it? the slow rodgering of the spikey end of a pineapple weaves it's way up the poop shoot as the big end of business sucks up the arse of government in a wave of corruption, spin doctoring and shady deals.

elektra
25th Feb 2003, 23:00
I have to say Frank...your last paragraph was a lovely piece of English and a timely reminder that Hawke was neither the first or last to blur the distinction between the national interest and the interests of big business. The years ahead are going to be fun tho' because it doesn't look like VB are going to go away.

The_Equaliser
25th Feb 2003, 23:14
And who owns SQ anyway? Hardly a prime example of an accountable and fully transparent publicly listed company. Talk about competition and government interference by all means, just get the facts straight.

frank Borman
26th Feb 2003, 00:04
Elektra, and thats great, we don't want VB to go away. I know what you mean about Hawke as well, I'm actually apolitical, they all shit me!!

The _equaliser, I agree, but it's how you go about something, then after you have caused utter destruction through your alliance with the government, you then hypocritically go whining to get a fair deal and use incorrect claims to justify your position. Oh there is a mass of info in PM and C for an investigative journo to get their hands on.