QF Solution on Offer
 

It works for South West in the US.

BUY THE COMPANY.
 

I posted this earlier.

So how can the unions fight? In all honestly I believe this is a no win situation the way it is being fought. I have said it all along and will say it again - BUY THE COMPANY.

Qantas has about 33,000 employees. Market Cap ($M):3,364 Equiv. Shares (M): 2,265. Share price Average $1.50.

Through the union, set up a super fund which invests in qantas, and redirect other super funds into Qantas shares. The entire value of Qantas equates to $101,000 per employee. I know many employees that would be capable of buying that level of shares.

With redirected superannuation I calculate that approximately $30,000 per employee and we would have control of the company.

AS for SQ and EK. Different animals. SQ competes on service. EK competes because (a) it pays the majority of its staff absolutely peanuts in Dubai Pesos under some of the worst non-union protection (b) EK buys a lot of its fuel and a substantially lower price (c) EK has low interest Government funding/loans (d) IT pays no tax (including income tax/GST/Carbon Tax/payroll tax). Reality is EK is a glossed up LCC. Sat in a EK 777 with 10 across seating?

Qantas will NEVER be able to compete with Emirates. This is not QF's fault.
Qantas must compete by offering a better route network and yes maybe joint ventures are the way to go WITHOUT killing off Australian jobs

Unless everybody buys some Qantas shares (AND TAKES CONTROL) this rott at the top will continue to fester. Each and every Qantas employee could use margin loans to buy $30,000 of QAN shares. This would mean a cash investment of $9000 per head, on average. (Loans available at 70% of share price) With redirection of super funds into QAN shares we would take control

Wake up. I have been preaching this for ages and I wonder if Qantas employees really believe in Qantas and are as passionate as they pretend.
I am advocating investment, not donation. This is a tax effective, deductible investment that will save Qantas and ultimately be a profit making excercise

This is a fight with no winners. Both sides are going to come out badly bruised and battered while the name QANTAS becomes a festering mess that no one will go within cooee of.

QANTAS is reducing its own network (both internationally and domestically) to make way for JQ. I haven't seen a QF ad on TV or the paper in a long time advertising its services and networks with the choir singing in the background. The only ads QF have are full page advertisements in the paper bashing the "rogue unions", building a stronger QANTAS etc etc. Meanwhile JQ has TV advertisements and newspaper advertisements. I've even noticed lately on the side of JQ aircraft that the wording "A QANTAS Group Airline" down the side has been replaced by "All day, every day, low fares".

Even JQ is ridding itself of the QANTAS name.

Employees believe in QANTAS gone by. Not so much the current QF. It's been many years of constant conflict with the management undermining its own staff and keeping them under constant threat. Everyone is tired and just want to get on with what they're employed to do. No matter who you talk to, it is the same topic of discussion and everyone is just fed up.

Anyway, if all employees were to take up arms and buy an allotted amount of shares, who would be appointed as the management team to run QF? I could imagine the fighting over who is going to take control. Will it be the pilots? Engineers? Cabin crew? Cleaners? Check-in? Would it be a rotating term of managment?

It all sounds great, but I have seen how people within a crew carry on with one another. Imagine it at an upper level like running the company.

An Excellent Idea But....
 

Trying to organize 30000 people to buy out Qantas would be a logistical nightmare.There are 16 unions .They would all need to be on the same page for this to work.A lot of Egos to deal with

What a great idea! :hmm: Ignoring the requirements under the Superannation Industry (Supervision) Act 1993 on investments in the shares and property of employer sponsors of funds, having ALL of your Super invested in the future of your current employer is a great, "No Risk" solution! :ugh:

1a,

I think you are dreaming if you think employees will be able to buy the company or enough shares to control the company at the current market cap. Where do you think the shares are gonna come from? Most people holding Qantas stock now are losing money and I doubt they would sell for anything under $2.50ish. A successful bid would need to be pitched at the $3 to $3.50 range IMO. You can have my shares for $2.80 a piece!

Theres no reason the right structure wouldn't comply with the Superannuation Industry (Supervision) Act

$2.80 a share? :ugh:what you want an instant almost 100% profit, talk about greedy.:mad:

As I illustrated earlier nothing to stop individual employees using margin loans to buy QAN shares. Sure the share price will rise and that will mean an instant profit for those that got in at $1.47.

All too hard? Yeah it is for most who want to sit back and hope it will all get better. Well it wont happen like that I am afraid.

You have to accept that the desire to smash apart the unions and break up the airline into bits comes from the board. And the board is only controlled by the shareholders. If you have no shares you have no say.

A huge group of united employees with shares could easily force control:ok:

In no particular order, please consider the following clarifications to the above posts:

· Any employee backed shareholding strategy doesn’t need to acquire 100% of QAN to change the strategy management are presently pursuing, but preventing the set up of ‘Fantasia’ and halting the demise of Qantas International would need to be accepted as central to any new business plan,
· Employee shareholders would not assume responsibility for the role of management and running QF. That said, employee shareholders with a substantial holding can probably get appointed Director Representatives who could then partner with other aligned Directors to develop alternative strategy and policy. I.e. it would still fall to Management and the Unions to agree enterprise changes acceptable to both the ‘New Owners’ and the Workforce,
· A quick look at other takeover bids suggests that the prevailing share price jumps by around 50% when a bid is formally announced,
· Not only does it work for South West, more importantly, it would facilitate an overarching strategy with the potential to unite, Government, Shareholders & Staff. Without it, agree with the sentiment that a no win outcome is all but certain for all involved.

Doesn’t really matter if such an initiative is commenced by enlighten management, troubled shareholders or concerned staff, as ultimately all will need to support it if Qantas is to be turned around and a new course charted.

1a,

$2.80 per share may be an instant 100% profit for some, but not me mate. I have been a large shareholder for years (not just a token amount of shares like some of these crazy employees who actually think they should control the company) and participated in all capital raisings, so I'd be happy to just get my money back mate because its people like me that have funded this business that has kept people like you employed for years. Some of your colleagues on this forum even call airline investors 'morons' would you believe! The only morons around here are the vandals associated with these unions destroying their own jobs. Answer my question, where do you reckon most of these invisible shares are going to come from in this proposed takeover bid by employees without paying a big premium? **The book value as at Jun 2011 is $2.67. Qantas carry's its fleet of aircraft and engines at about $10b. The real value of their fleet is closer to $5b. If we say $2b of the $10b is engines, then QF are probably carrying $2-3b more in aircraft value Vs real commercial value on their balance sheet or around $1.30 per share. So the adjusted book value ought to be more like $1.40 per share PLUS the frequent flyer business.

Therefore you can forget your pipe dream plan of gaining control at these levels!

NP

**Numbers published by Macquarie Private Wealth.

Macquarie Bank
 

As we all know Macquarie Bank are never wrong about anything and everything.Warren Buffett has often said that airlines are a poor investment.There are those that believe that unions are responsible for Qantas' woes.Unions are not responsible for the purchase of aircraft or the development of a network or the cost of borrowings.In fact unions make no managerial decisions whatsoever.The only cost that unions seek to influence is the cost of labour.The cost of fuel and the purchase cost of aircraft are outside their jurisdiction.
The total cost of labour for the Qantas business is 16% and has been declining for the last 10 years.
The wages bill for the Qantas Exco and the board are substantial and much higher than a comparable size airline.
The trouble at Qantas has its roots in the merger with Australian and the subsequent loss of operational expertise.Many of the executives now running Qantas were at the helm of Ansett when it folded .They are now weaving their magic at Qantas.One only has to look at Virgin and its accomplishment of the last 12 months to recognize the ability of a very competent CEO.
If John Borghetti was running Qantas it would not be in the mess that it now finds itself.
Scapegoating the unions for management incompetence is the oldest cliched spin on the planet.There are still those naive enough to believe it

Crossing,

All investments are poor investments if one pays too much for them. Rather, QF will prove to be a good rebound opportunity in time from these levels (no doubt well and truly missed by all union members on this forum). Buffett also says be greedy when others are fearful.

NP

New Piper
 

Lets revisit this conversation in 12 months time...and commiserate
Lets not confuse fear with commonsense
Your Buffett quote was not made by him in relation to Aviation

New Piper, if you don't like your investment, bail out. I guess it takes a moron to invest in a company of morons. Your words not mine. Your piddly amount of shares do not keep us in jobs. We have not cut dividend payments for the last few years, even though QANTAS has been the most profitable airline. Maybe you should be criticising the people you put your faith and trust in. Maybe you did mean that the management are morons, but I suspect I'm wrong about that point.

Long before the greedy investors like yourself came in and stuffed QANTAS, it was government owned and run. Not a brand. A company that had control on everything that went on in it and made smart decisions on the aircraft it flew.

If investors had half a brain, they wouldn't invest in the share market and hope to make a quick buck. That's what race tracks and pokies are for.

It appears that as an investor, you have the God given right to dictate to a company and its employees. Without employees, and competent ones at that, there would be no business and "investors" like yourself would not be able to make money off the backs of those employees.

As has been mentioned, the employees and unions don't make incompetent decisions that drive a share price down, and yet reward the board of directors for either their incompetence or deliberate sabotage of a company to drive its share price down so that it is ripe for the picking, whilst lining their own pockets.

If you want to believe in your own self-importance, that's your prerogative.

Maybe one should look at Richard Branson's ethics. Customers and investors come second in the business. Employees come first. Without happy employees, you will not have happy customers or investors. Voila, QANTAS.

Once again, if you don't like your QANTAS investment, sell up, cut your losses and get out of our faces. Otherwise, get a seat on the board of directors and make some decisions. You have the same mentality as our current regime of imbeciles and would fit in perfectly.

It appears that as an investor, you have the God given right to dictate to a company and its employees.

Correct.

The shareholders own the company.

The employees work for the shareholders.

God has nothing to do with it.

and everyone has a big mouth and is full of ideas until the **** hits their fan.

I will say it again: management spin about competing globally means you go down to the lowest common denominator. That ultimately means health care, pensions everything. We or even the western industrialised world cannot compete with China and we shouldn't try.

Australian wages and product pricing takes into account the social infrastructure in place in Australia as prices do in China, i.e. there ain't no social infrastructure.

Qantas today, NAB tomorrow. Think about it.

Incorrect unseen. Employees work for the company. Shareholders buy shares into the company hoping to get a return.

Even as a shareholder, you don't get to have much of a say. Even if you were to oppose the remuneration package of the directors, they will see fit to pay themselves.

Here is a snippet from QANTAS to its shareholders dated 26 September 2011:


"The 2011 Remuneartion Report is contained in the Directors' Report set out from page 36 of the 2011 Annual Report. The Report explains Qantas' Executive Remuneration Objectives and Approach, which are to:

• attract, retain and appropriately reward a capable Executive team;
• motivate the Executive team to meet the unique challenges Qantas faces as a major international airline based in Australia; and
• link remuneration to performance.

I and my fellow Directors believe that Qantas' Executive Remuneration Framework is commercially and ethically responsible, and supports our objective of providing sustainable returns to shareholders.

Therefore, the Directors recommend that you vote in favour of the Advisory Resolution to adopt the Remuneration Report for the year ended 30 June 2011.

Yours sincerely

Leigh Clifford AO"

The above three points indicate that the Executive is not capable and should not be retained. QANTAS faces the same challenges as Virgin Australia, being based in Australia. Remuneration of the directors should be cut if linked to performance, as the share price has dived and there have been no returns to the valued shareholders for the last few years.

Were the shareholders asked if the CEO could get a 71% pay increase or the rest of the board for that matter? Do the shareholders have a say in the type of aircraft chosen to fly? Do the shareholders have a say in how the company is run? No. No and No.

With the management's ideas and the shareholders' money, the management can blow it any way they want, and it costs them nothing, leaving shareholders like yourself in the dark and waiting for a return on their declining investment.

If you think employees work for the shareholders. Sure. I'm happy to take your money every fortnight and put it in my pocket. My paypacket doesn't change, regardless of the share price. God has nothing to do with that either.

QF94,

Its an attitude like yours that will drive the investor celebrations when your job or the jobs of people like you become 'offshored' and that is only a matter of time. Angry souls have no place in a business like Qantas.

Best you get your resume in order if not already done so, pretty soon you are going to need it!

NP

For your consideration.

The philosophy of ownership is intended as an alternative to 100 years of Australian adversarial industrial negotiations. It has at its heart, employee voice/participation, productivity and a fair share of enterprise contribution put at risk by shareholders and employees alike. It is not a panacea for all that one doesn’t like about where Qantas is going, but it is a concept that has saved a lot of companies and jobs in the UK & the US.

Yes, I do admit that Australia’s industrial system got us by quite OK; right up until we found ourselves in the deep end of globalisation - a genie no one has been able to put back in the bottle.

Experience elsewhere in the world has shown that employee shareholders are able to influence company policy and strategy and right now it is QF’s strategy that is underpinning all the angst. That said, there is a world of difference between turning Qantas around and using the current Qantas situation to fight legitimate concerns about the unintended consequences of globalisation.

To be frank, why would Government/Shareholders do the heavy lifting necessary to save Qantas International if QF’s own employees won’t get behind a strategy that has the potential to save their jobs by bringing together Government, Shareholders and Staff.

*sigh* I know we are not meant to feed trolls

New Piper:

Your continual 'glee' at the prospect of Australians losing jobs,having jobs off-shored is utterly disgusting.

I have a family to support,a mortgage and I may be facing that exact prospect. I have worked hard for QF and should get some of the loyalty back from management that I have shown them.

I don't really care if you are who you say -some 'investor of magnitude' or if you are just some QF management idiot trying to get a rise out of people on here.

Your attitude is totally un-Australian,and so totally wrong in so many ways.

To think that someone would revel in the fact that others may lose their jobs,and then wave it in their faces :mad::mad::mad:

You are a repulsive human being. :ugh:

NP,

I guess that's why you're offshored and you are an angry soul because your shares are not doing so well. See your much revered CEO about why your share price is wallowing in the pits. Not the workers who don't have a say in which direction the company is going. It's also reassuring to know that individuals like yourself will derive great pleasure when jobs are lost so you can make a few miserable dollars. I hope your afterlife has enough space for all the dividends QANTAS will be paying you.

It's a looooong way back to $2.80. 5, 10, 15 years? Who knows? Who cares? Enjoy your losses, because I certainly am.

It's a bit difficult to have offshore people running a business in Australia, unless that's the direction of QANTAS. Maybe you would like QF onshore with you. Quite possible you may want to get back into a company that offshored you.

I will be here in QANTAS long after the board are made to step down once their own "indiscretions" are exposed and the angry mob of shareholders want explanations as to why a company like QANTAS has fallen from grace in such a short period as it has in the last 7 to 10 years. It takes a long time to build a company like QANTAS, but not so long to destroy it in the name of making it a "Stronger QANTAS" for a greedy few, inclusive of yourself.

Half of Qantas' jobs are on the line - as the boss Alan Joyce gets a nice $2 million bonus | News.com.au

Alan Joyce has warned that half the airline would "be gone" within a year, if unions pursued their industrial campaign into 2012. The Qantas Board will not be stepping down. Shareholders have spoken and Government is not going to use the Sale Act to halt the establishment of RedQ.

If the workers want to keep Qantas in Australia, it looks more and more like they are going to have to buy in.

Sadly true, however some figures posted on another forum make that option increasingly unlikely too.

When 240 shareholders own 82.5% of the shares on offer, the other 133,400 shareholders have little chance of acquiring a reasonable holding at a reasonable price.

I'm sure you can guess who's amongst the 240 "lucky" owners who would stand to gain enormously from any even relatively inflated offer for the company.:rolleyes:

I was in attendance at the AGM yesterday, and it was a disgusting display of arrogance and beligerance on the part of the board. Especially when the remuneration of AJ was passed, to see him look up at the shareholders, sit back in his chair and smirk at everyone. Also stating that they (the board) will not be told how to run "their" business. It is not their business at all. Richard Branson can say Virgin is his Business, because it is. Bill gates can say Microsoft is his buisness because it is. This pack of parasites are milking a company for all it's worth to build their own business, offshore, otherwise known as Jetstar Asia.

It was a foregone conclusion that the resolutions were passed in favour of the board, and whether there is continued industrial action or not, "we will have no choice but to shrink the airline bit by bit." This has been going on since the days of Geoff Dixon and since May 2004 when the birth of Jetstar was the beginning of the death of QANTAS.

AJ went on to say that if they go ahead with the Pan Asia move, not one Australian job will be lost. He's correct. it will be 'tousands' of jobs.

Dick Smith was also surprising in the Daily Tele today. "If QANTAS International doesn't get globalised wages it will go out of business". There is a flaw in this theory. if Australia doesn't get globalised prices for the cost of living, Australia will be out of business. We simply cannot compare our wages with Asia, as we cannot compare our cost of living with Asia. Corporations are quite happy to employ cheap labour overseas, whilst putting thousands of Australians out of work. Here's the kicker. How will these same businesses be able to stay in Australia when there is no one to buy their products?

It is unfortunate to think this, but QF days look numbered and may be laying next to Ansett. if this happens, the board may have to take residence overseas for their own protection. The alleged death threats may become a reality. For the record, I am not making the threat. just an observation.

I assume he was talking about the board isn't he?

I missed part of the dribble by AJ..

What is the reason the share price has tanked??

According to those oracles.....

Hmm shrinking the airline ha.. Before it was a covert plan. Now they can use this dispute as an overt plan to carry out what they were gonna do anyway.

The board won't be out of business. They've propped themselves up nicely. AJ was in Ansett and look what happened to it.

Quote:
"If action continues as the unions have promised, we will have no choice but to shrink the airline bit by bit," he said.

Qantas is baiting the unions to ramp up action IMO. Its what they want so they can legitimately shrink Qantas down. Surely this is obvious to people??

This is obvious, and has been for some time. The issue is, it is going to be done regardless. That is why the board are not negotiating and wanting the dispute. The dispute is their cover. If there is no dispute, and the basic 3% is accepted with nothing else, we will still be too expensive because LAME's are on $170,000 a piece while the pilots are on $300,00 or so say AJ and OW, and will only delay their shrinking of the airline, not stop it.

Christ, take what they give and hope that AJ gets the arse in a year or 2. Make it hard for them. Union action is just giving it to them on a silver platter. 1989 all again

Hope AJ gets the flick in a year or two? There was hope he may have been a bit different than Dixon. He is just as bad, if not worse, with Clifford's backing. That will be like waiting for the next federal election and hope all will be OK after the carbon tax is in place next year.

I don't believe that industrial action is what most people want, but the situation is a bit like the cartoon below. We are being trashed by the board and this is the last great act of defiance.

I'll say it again, all three unions are falling into a massive bear trap. Shutting down 50% of Qantas is a reality and like I said before, it may seem like a radical move but THEY WILL DO IT if necessary, and when they do, the share price will start to rise. 98% of shareholders approve of the boards intentions and even though the board doesn't personally own all outstanding shares, 98% of all outstanding shares authorise them to run the Company and make decisions for shareholders, employees and customers.

Ansett all over again?? Well not quite, but for the employees that will be sacked, yes it will be Ansett all over again, most of whom are innocent hard working, dedicated QF employees who understand the simple concept that QF is now post 9/11, post SARS, post GFC, high Oil prices etc etc AND trying to operate in an environment full of heavily subsidised competitors. For the shareholders, it won't be Ansett all over again, because they own several other valuable portfolio assets that will soak up (in time) plenty of slack left behind by QF LH. Also, QF LH is not worth much today. In fact, some say the market is attributing a NEGATIVE value on the share price because of QF LH. If true, that should be a huge red flag for employees.

The market gap left behind by QF LH will feed Jetstar growth for years and make it an even more valuable and profitable business. The QF LH 'Shell' will still be owned by shareholders and those 'smirk' faced board members (as you call them) will inevitably re-start QF LH in some form or another without the menacing staff that I understand were present at the AGM yesterday.

98% of shareholders support the CEO. Take 1a's advice and do a deal, but time is fast running out. The damage has already been done, and its only a matter of time now before LH ops get seriously reduced and restructured which will result in big job losses.

No doubt, most posters on here will blame it on corporate greed (correctly so) but blind Freddy can see that some of the contributory fault lies with the Union leaders but they will NEVER admit that. They probably already know that their battles are fruitless, so rather than swallow their pride, they will fight to the end with member funds until members lose their union and their jobs.

Unless deals are done now, it will all end in tears, mainly for the affected employees and associated industry businesses but not the Shareholders.

Madness!!! Why fight an unwinnable battle?

NP

Bring back the overtime bans and let us all be patient and wait. A deal will come when the Board and Managers want a deal, not a minute sooner. That will come when institution investors start getting anxious about their investment.

A further Senate hearing begins this Friday. It could also bring forward a resolution to this, but I doubt it. Hopefully it will expose QANTAS Management plans as risky and against the National Interest. If that occurs , the union movement will have to claim it as a win, but that alone will not get us a deal.

I can't see a deal occurring as it would be in direct opposition to the stated company's direction for the future. They aren't going to change the off shoring to Asia and even if the government intervened and forced negotiations that is always going to be a sticking point. You need a third party (ie the government, a court case, or a takeover and removal of the board) to intervene and stop the company's outsourcing into Asia. Striking isn't going to do much.

So all that will happen is that jobs will be lost over a period of time as they slowly shrink the company.

Is everyone forgetting that jetstar is owned by qantas, paid for by qantas and has no rights without qantas. Shut down qantas and jetstar will fold inside a year. It is not a cash cow. It makes a profit on paper due to creative accounting and at the expense of qantas mainline. Jetstar's whole international fleet are qantas aircraft. Fold qantas, jetstar will go too

Problem is they have been spinning lies for so long they have confused truth & fiction, they think J* is propping up QF :ugh:

You can blame who ever you like, but blaming the pilots for this mess is out of step with reality.

Qantas pilots are not on strike.
Qantas pilots have not been on strike since 1966.

Red ties and PA's will not cause loss of revenue for QF.

Any current pay rate Qantas pilots are on has been mutually agreed by Qantas management and Qantas pilots.

QANTAS won't fold or disappear. The name will be around enough to keep Jetstar going. I'm sure the board won't want to pay themselves Jetstar salaries. They still need QANTAS shares, because there's no such thing as a Jetstar share.

IF QANTAS was to disappear, so do the big salaries. Also, an Australia without QANTAS is one that won't function as well either. The infrastructure of QANTAS within this country is too big for any other airline or aviation company to fill. Even Jetstar.

QANTAS won't be halved. If it is, then Jetstar won't be able to take advantage of QF's leverage in buying power as was stated in yesterday's meeting, and will have to pay higher prices for its fleet. It doesn't have the investment grading QANTAS has. Jetstar actually has zero in anything.

Maybe the government should step in and nationalise the company. Set the wages for the board and stabilise the company in the National Interest. Not in the interest of the self-serving dozen on the board.

Personally I think LC aka 'the emperor' is the cause of this head ache.

Obviously AJ is his mouth piece and LC is calling the shots at Qantas.

AJ will take the fall or the credit whatever the result. I believe it will be the fall, as this strategy they are pursuing has knobs on it.

Let's hope LC chokes on his grange for the good of the nation. Perhaps the Rio Tinto fellas need to be brought on board from his last stoush as 'advisers'

He'd love that :ok:

Don't forget, by Alan Joyce's stated plan, "RedQ' or whatever is only Stage 1 of his restructure of international ops. He hasn't said how many stages are to come, but rest assured if you cave in at stage 1 you will be decimated in the later stages. May well happen even if you don't cave in.