Air NZ looking to sell some/all of stake in VA

[Bagpuss]

Virgin won't be going away - there owners have changed a few times in the past.....I would keep an eye on Singappore or, more likelyy, Etihad, having a tilt at a takeover...

I wouldnt be surprised if Delta buys in. Especially as they bought the SQ stake of Virgin Atlantic.

Though I'm a bit concerned about the amount of $$$ VA seems to be burning through. You would have thought a lot of expense has been done by now with rebranding etc.

 

[Milefest]

Though I'm a bit concerned about the amount of $$$ VA seems to be burning through. You would have thought a lot of expense has been done by now with rebranding etc.

Last year there were quite a few major projects with the new Perth terminal and lounge, Brisbane lounge upgrade with Premium Entry, 'The Business' introduction and a new alliance with BP to name a few.

Can't see as many projects taking place this year. Would love to see some domestic J lounges but I think they will be quite far down the track..

 

[Deleted member 29185]

I've just been to the grave of my 1m AN points to lay a wreath due to the last time ANZ rooted with one of our airlines. As soon as I'm home again, I'll be transferring our balance.

 

[quokka77]

Ansett was a completely different beast. VA may not be making much money, but they aren't losing it completely. Both Etihad and Singapore are pretty big fish, who have a big stake already. NZ are under pressure at home, so it isn't that surprising they'd want to look at selling out. Maybe Etihad and SQ will move to 45% each, with Branson retaining his 10%.

 

[Deleted member 29185]

Ansett was a completely different beast.

Yes, of course. ANZ was able to strip all the flesh off and just leave the carcass with Ansett. They have "overseers" with VA, which is probably p*ssing them off, no end.

 

[AviationNZ]

Yes, of course. ANZ was able to strip all the flesh off and just leave the carcass with Ansett. They have "overseers" with VA, which is probably p*ssing them off, no end.

The flesh was stripped long before NZ bought into Ansett. Probably best to look back a little further to the management (or lack there of) from News Corp. Bad fleet choices, bad union relationships, the AU Gov backing QF....the list goes on.

 

[Deleted member 29185]

The flesh was stripped long before NZ bought into Ansett. Probably best to look back a little further to the management (or lack there of) from News Corp. Bad fleet choices, bad union relationships, the AU Gov backing QF....the list goes on.

So ANZ were too inept to understand "due diligence"? I'm not sure which is worse.

 

[AviationNZ]

So ANZ were too inept to understand "due diligence"? I'm not sure which is worse.

No one can doubt that it was a very bad business decision. But at the same time there is plenty of suspicion about what books they were shown. In any case, AN were on a slippery slope that would've most likely been unrecoverable.

 

[Deleted member 29185]

at the same time there is plenty of suspicion about what books they were shown.

Well I can show them my books......where they cost me 1m+ points.....(and I consider myself lucky)......I'm really most cranky for the good people that lost their livelihoods due to a shonky (sorry, inept) company!

 

[AviationNZ]

Well I can show them my books......where they cost me 1m+ points.....(and I consider myself lucky)......I'm really most cranky for the good people that lost their livelihoods due to a shonky (sorry, inept) company!

And that I can totally agree on. Lost jobs and livelihoods is horrible, you don't wish that on anyone. The ones left with the hot potato will always take the blame, and whilst there is responsibility on their behalf, News Corp have a lot more to answer for as they set the wheels in motion.

As for lost FF points, that's a frustration, but nothing compared to lost jobs.

 

[Deleted member 29185]

As for lost FF points, that's a frustration, but nothing compared to lost jobs.

We certainly agree on that point (or loss thereof )

 

[drewbles]

Yes, of course. ANZ was able to strip all the flesh off and just leave the carcass with Ansett. They have "overseers" with VA, which is probably p*ssing them off, no end.

NZ didn't screw AN over, News Corp and TNT did. They pretty much stripped the company of worth, then let NZ buy it. I still maintain to this day if SQ had bought in, AN would be here still and the aviation landscape would be very very different.

NZ had first right of refusal to buy the TNT/News stake, which they did. They did not have the cash themselves at the time and let AN go under to save themselves (otherwise both would have gone under).

Knee-jerk reaction. Aviation is a long term game. That said, JB seriously needs to fix their cluster f*#$ of an IT system, integrate it better, and join a bloody alliance!

 

[Deleted member 29185]

They pretty much stripped the company of worth, then let NZ buy it.

See this post

 

[Tremere]

NZ had first right of refusal to buy the TNT/News stake, which they did. They did not have the cash themselves at the time and let AN go under to save themselves (otherwise both would have gone under).

From memory, they (ANZ) were driven to do this by the private equity firm that owned the majority of shares after privatisation, presumably they wanted to force SQ to pay more for a stake in the combined group. Came unstuck in part due to the NZ government not budging on the foreign ownership limit.

There is a good article from the time that describes the machinations - search "Four Corners High Stakes" (11/06/2001) - I can't link directly due to my low post count.

 

[cambriamarsh]

Yes, of course. ANZ was able to strip all the flesh off and just leave the carcass with Ansett. They have "overseers" with VA, which is probably p*ssing them off, no end.

AN nearly bankrupted NZ, don't think there was much flesh stripping going on.

 

[cambriamarsh]

So ANZ were too inept to understand "due diligence"? I'm not sure which is worse.

Fair comment, too naive.

 

[samh004]

Maybe Etihad and SQ will move to 45% each, with Branson retaining his 10%.

I'm still unsure how VA could be jointly owned by EY & SQ 45% each, and that not be an issue with foreign investment rules. I'm not arguing for the sake of QF, but rather how they could own a company that owns a company being allowable? It makes no sense.

 

[Tremere]

I'm still unsure how VA could be jointly owned by EY & SQ 45% each, and that not be an issue with foreign investment rules. I'm not arguing for the sake of QF, but rather how they could own a company that owns a company being allowable? It makes no sense.

The foreign subsidiary (VA Intl) has majority Australian ownership, while there are no limitations on foreign ownership for domestic airlines.
This is the same structure used for AN, so nothing new, the QF sale act prevented QF from using the same trick.

 

[moa999]

The foreign subsidiary (VA Intl) has majority Australian ownership

Except it's not separately listed, does not have separate management and does not publish separate financials.

If it is the arm losing money it seems strange that the other airline shareholders would provide loans to an entity they don't own

I thought Ansett was a different case due to Single Aviation Market rules, much like the EU

 

[Bagpuss]

A 'run on the bank' with everyone transferring points out to KrisFlyer would cripple Velocity in an heartbeat.
Must say - I feel uneasy with a velocity balance. Especially with the junk offers they send me - says to me they're not good at monetizing their data.

Just moved 75% of my Velocity balance out to Krisflyer

To clarify, if you transfer Velocity points to KrisFlyer, Velocity would earn an income as they are effectively selling the points. So it's actually "costing" Singapore Airlines.
Depending on the deal between the two partners Velocity/Virgin could be financially gaining by transferring points out.