Ansett: Air NZ stripped assets

[Wirraway]

Tues "Herald Sun". .. .Ansett: Air NZ stripped assets. .By Luke McIlveen. .19mar02. .. .ANSETT's administrators are considering legal action against former parent company Air New Zealand for allegedly stripping the Australian airline's assets, despite a $150 million payment that Air New Zealand believed would absolve it of any liability.. .. .The second creditors report by administrators Andersen, released yesterday, said there was evidence Air New Zealand had engaged in "asset stripping" and the "inappropriate charging of fuel and other operating costs" prior to Ansett's collapse. . .Air New Zealand has repeatedly denied the allegations and the New Zealand Government oversaw a one-off $150 million payment to Ansett to clear the parent company of future liability. . .. .New Zealand Prime Minister Helen Clark has said the company had inherited a "lemon" that was bleeding funds before Air New Zealand became involved. . .. .Administrators Mark Mentha and Mark Korda confirmed in their latest report that action might also be taken against the Ansett Group of Companies for granting handsome bonuses to some executives in August 2001, barely a month before the 66-year-old airline collapsed. . .. .However, the report emphasised that any proposed legal action against Tesna, the consortium headed by businessmen Lindsay Fox and Solomon Lew, had virtually no chance of succeeding. . .. .The administrators and trade unions had previously hinted at seeking compensation from Tesna for its 11th-hour withdrawal from the Ansett deal. . .. .The administrators confirmed they would recommend that creditors enter into a Deed of Company Arrangement rather than place the failed airline into liquidation. . .. .As such, they are hopeful of selling key Ansett assets -- including the domestic airport terminals at Sydney airports -- with a view to recovering maximum value. . .. .As expected, unsecured creditors can expect nothing in the wake of the Tesna withdrawal. Mr Korda and Mr Mentha said they had hoped to return up to 5c in the dollar to holders of frequent flyer points, but the collapse of the Tesna deal made any return unlikely. . .. ."If the sale did not complete, it was unlikely there would be enough funds to pay priority creditors in full and therefore no dividend would be available to other unsecured creditors," the report said. . .. .The revamped Virgin Blue -- which last week received a $260 million injection from Patrick Corp -- has expressed interest in the terminals, along with the Government-owned Sydney Airports Corp. . .. .The report revealed that Singapore Airlines had also entered the bidding for the terminals and other key Ansett assets. . .. .The federal Government's decision to put Sydney Airport back on the market has put SACL in the frontrunning for the terminals because it would significantly increase the airport's value. . .. .Tony Stuart, chief executive of SACL, last week confirmed he was interested in securing the terminals with a view to leasing them to a range of airlines. . .. .An information memorandum will be issued to the interested parties this week, outlining the range of Ansett assets available.

[Wirraway]

Tues "Sydney Morning Herald". .. .Air NZ may face action on collapse . .. .By Darren Goodsir, Transport Editor . .. .Ansett's administrators are investigating a range of legal actions against Air New Zealand, its former parent, as pressure mounts to explain the airline's collapsed sale.. .. .In a report released yesterday to Ansett's 3.6 million creditors, the administrators, Mark Mentha and Mark Korda, said actions were being considered against "a number of parties" - including the Tesna syndicate that withdrew from the sale - in a bid to recoup losses.. .. .The report said inquiries were continuing into "potential breaches by directors and officers" of Air New Zealand.. .. .This included the controversial payment of performance bonuses to directors last August, weeks before Air New Zealand cut Ansett adrift. Days later, all planes were grounded and 47,000 passengers stranded.. .. .The administrators revealed they were also looking at Air New Zealand's accounting practices, the centralisation of its treasury functions, "and sweeping of bank accounts" held in Ansett names.. .. .Other items being examined are "alleged asset stripping ... [and] inappropriate charging of fuel and operating costs".. .. .In their first official statement to creditors since the Tesna syndicate, led by Solomon Lew and Lindsay Fox, aborted its takeover of Ansett, the administrators stressed any legal action would be "difficult to prove ... time consuming and expensive to pursue".. .. .Unsecured creditors are now expected to get no return. If the Tesna deal had gone through, they stood to get a return of only 5¢ in the dollar. In their report, the administrators said priority creditors, including workers, stood to win back all of their entitlements.. .. .They said only four of the 49 fully-owned aircraft had been sold. . .. ."Given the depressed state of the global airline industry and reduction in value of aviation assets due to events of 11 September 2001, the sale of aircraft could take up to two years to complete," the report said.. .. .The administrators want creditors to approve a deed of company arrangement, in preference to liquidation. They have argued this will allow the domestic terminals to be sold on a commercial basis. If Ansett was liquidated, the administrators said, the airports could exercise "buy-back" provisions under default clauses - offering only "market value" prices.. .. .Meanwhile, New Zealand's Finance Minister, Michael Cullen, revealed yesterday that he recently redirected a call from Qantas's chief executive, Geoff Dixon, to the Air New Zealand board, when he was asked how to advance a potential alliance between the two airlines.. .. .Dr Cullen said it was important that Qantas - and any other parties - dealt directly with Air New Zealand's directors on all commercial matters, even though the airline was 83 per cent government-owned.. .. ."This is not 'leaving the door open'," he said of his policy.. .. ."This is politely closing my door and pointing Qantas in the direction of the board's door, which is the one they should be knocking on.". .. .Air New Zealand's chief executive, Ralph Norris, said at the weekend the airline was "looking at the options" for a new shareholder. . .. .Qantas is considered favourite for taking a cornerstone shareholding in Air New Zealand but Virgin Blue has recently also expressed interest.

[GoodToGo!]

49 fully owned aircraft? Not that I recall....... .Is this 'lets sue AirNZ' mentality (albeit a damn good one!) just a trick to get the Administrators back in the good books with the (now ex-)employees? Why didn't they persue all this at the start? What game are they playing at?. .. .B*stards..... .. .GTG! <img border="0" title="" alt="[Mad]" src="mad.gif" />

[Barbers Pole]

Nothing like throwing a couple of conspiracy theories around to try and take the heat off the failed Tensa deal.. .. .The sooner they liquidate the assets the better for everyone.

[Mungo]

Looks like M&M are trying to cover their rear orifices. I seem to recall a report, and if memory serves me correctly it was penned by them, which stated that there there was no asset stripping, no removal of money from Ansett's bank accounts (would have been hard to do anyway 'cause there wasn't any!!) and no inappropriate use of the fuel accounts.. .. .More journalistic claptrap - at this point the asset stripping is alleged, not fact as the headline would have the unsuspecting reader believe.. .. .As I've already said, the allegation was made six months ago, investigated six months ago, and found to be totally unsubstantiated six months ago by the same clowns who are making the same allegations today. Make me wonder why Ansett II isn't flying today - not!!!. .. .All I can say, and it is said in all sincerity, is good luck and all the best for the future to all the Ansett folk out there.

[strobes_on]

mungo. .. .Yes, I too recall the vehement denials by M & M of asset stripping by Air NZ. . .. .This should have been thoroughly investigated at the time.. .. .Their credibility is starting to wear just a bit thin.. .. .Sounds like buck passing.

[Kaptin M]

However the M&M`s were quite happy to pass this off to FLEW without whispering a word of it until NOW! . .Or would this also have been FLEW`s excuse for shutting the airline, had they got their hands on it?. .. .Either way, I believe that Ansett has ended up where it was destined for some time - raped, pillaged and finally grounded.. .. .And there`s ABSOLUTELY no way that Air New Zealand could be held totally responsible.. .IF...IF..they were guilty of any of the allegations made, they are by no means the first to have indulged in the plunder of Ansett - nor the last!. .It`s still going on. The lions have finally brought the behemoth down and killed it - now the hyenas and vultures are stripping any remaining flesh from the skeleton.. .And the stench of the parasite-infested, rotting guts is attracting a few blowflies as well!

[Buster Hyman]

I suppose it all has to be taken in the original context. Whilst not defending Andersens, they had $150 million from ANZ & about 4 genuiune offers on the table. They wouldn't have wanted to jeopardise the sale, at the time, by saying that ANZ had stripped assets. It wouldn't have gone down well with the potential buyers at the time.. .. .Also, they needed cash to keep Ansett flying & here was ANZ about to give them cash. Perhaps the "no litigation" deal was conditional on the sale of Ansett?

[Wirraway]

Air NZ denies strip claims. .AAP. .19mar02. .. .AIR New Zealand has vowed to mount a vigorous defence against allegations it had stripped assets from Ansett in the dying days of the company last September. . .. .In a statement issued this morning, Air NZ managing director Ralph Norris hit back at claims contained in the latest report to creditors by Ansett administrators Andersen. . .. .In the report, issued yesterday, administrators Mark Korda and Mark Mentha said they were considering legal action against the former Ansett parent company for alleged asset stripping and alleged inappropriate charging of fuel and other operating costs. . .. .Mr Norris said he was disappointed at the revival of the asset stripping claims, which first arose at the time of the collapse. . .. ."We are disappointed to see the Ansett administrators reviving allegations of asset stripping and inappropriate charging after reaching agreement with us to settle all claims between Ansett and Air New Zealand," Mr Norris said. . .. ."The allegations are nothing more than groundless rumours which were circulated when anger over the loss of Ansett was at its peak. . .. ."We refuted them at the time and continue to do so."

[gaunty]

They'll both need lessons from Mr Houdini to wiggle their way round this one.. .. .It will provide some interesting viewing.. .. .Let the games begin....once again. <img border="0" title="" alt="[Confused]" src="confused.gif" />

[Wirraway]

Tues NZ "The Dominion". .. .Air NZ seeks to raise $200m. .19 March 2002 . .. .Air New Zealand's small shareholders could be asked for another $36 million as part of a $200 million capital raising announced by the airline at the weekend, one industry analyst said yesterday. . .. .The Government would have to foot the bill for the remaining $164 million in a significant negative development for the Air New Zealand, the analyst said.. .. .Air New Zealand's chief executive Ralph Norris told an Australian television station that the state-owned carrier had enough money to operate for the next several months, but would raise new capital via a rights issue.. .. .Air New Zealand was bailed out with $885 million of taxpayer money which bought an 82 per cent stake. The Government has pledged another $150 million which can be drawn on, preferably through a rights issue, before June 30, 2003.. .. ."We're probably looking in the order of NZ$200 million," Mr Norris said.. .. ."We've got a strategy that is going to be workable and one that is going to be attractive to the Government particularly to put up the extra $150 million, so I would like to see us within a period of four to five months being in a position to do that," Mr Norris said.. .. .The analyst said the announcement indicated that Air New Zealand was still losing money and the situation was not sustainable.. .. .Air New Zealand was being squeezed by increasing competition from Qantas, and Singapore Airlines pulling out of a lucrative revenue sharing agreement, he said.. .. .Any rights issue will have a significant impact on small shareholders who bought into Air New Zealand in droves in September, after the share price collapsed, in the hope of making a big profits.. .. .Air New Zealand could raise the money by issuing 1 billion new shares to existing shareholders at 20 cents each, at a ratio of one share for every four held.. .. .Mum and dad shareholders would have the option of buying the shares, or have their investment diluted if they did not.. .. .Former cornerstone shareholders Brierley Investments and Singapore Airlines were unlikely to take part, further diluting their holdings of 5.5 per cent and 4.5 per cent respectively, the analyst said.. .. .Another option would be for the Government to sell down part of its stake to another cornerstone shareholder to raise the money.. .. .While that would solve a short term problem it would mean selling the airline at the lowest point of the industry cycle and minimise any upside on the Government's investment, the analyst said.. .. .With at least two potential competing bids from Qantas and Virgin Blue for any stake in Air New Zealand, it would be strategically better for the Government to hold on to its shares and sell a non-controlling stake when the airline had recovered.

[deepee]

Did you hear the one about all the Secondary School Teaches in Auckland going on strike??. .The NZ Govt are as happy as pigs in sh*t because they can throw some more $$$at Air NZ. <img border="0" title="" alt="[Cool]" src="cool.gif" />

[ferris]

You have to wonder about a denial that begins with waving a piece of paper saying 'we gave you money to settle any claims' ???????????. .That's not a denial, it's an admission with a 'but you can't touch me' at the end.

[N2000]

With a bit of thread creep.......... .. .Buster Hyman.....your sign-off....the P in Lloyd P Nash................stands for Percival. .. .and no its not pertinant. . . . <small>[ 20 March 2002, 16:02: Message edited by: N2000 ]</small>

[Skol]

See <a href="http://www.nzherald.co.nz" target="_blank">www.nzherald.co.nz</a>. .From the 2 Marks.. ."We have found nothing to support the allegations of assett stripping or alleged inappropriate charging of fuel and other operating costs."

[Lusimtingting]

No , it's not pertinant , it's pertinent.