QANTAS being taken over by Macquarie Bank..

[Evan]

If they meet all the requirements there is little reason for it to be blocked, i know the govt had the final say but they also can't be seen to be using personal opinion as a reason to block something, if they put rules in place and expect companys and individuals to play by them then they also sometimes must play by the rules.

As you sau will be interesting to see the debates !

As for QFF, well it would need to leave oneworld if it was dumped or altered significantly in a way that was not in the direction of where oneworld wishes to head. I see QFF staying myself, changes maybe but not that many.

Keeping QF as it is has its advantages as does the investment route, myself i sort of like the idea of an expansion and if done without too much debt could be a really really positive thing. The key is without too much debt ! and there is scope for QF to have more than it currently has if the investment is in the right areas.

I knew the shares were a good buy a while back and expected them to rise, should have purchased some, but i didn't expect the rise to be because they were going to be taken over.

Evan

 

[codash1099]

AAP News

Giant bonuses for Qantas executives
Saturday February 3, 2007, 5:55 am

Federal politicians have lashed out at senior Qantas executives who stand to acquire $300 million in bonuses.
Details emerged in a formal offer by corporate raiders bidding for the Australian airline, News Limited newspapers said..
The consortium revealed 11 Qantas executives would receive incentives equal to a 5.5 per cent stake in the new company.
Federal government and Labor MPs lashed out at the bonuses.
"I think such a payout is gross," federal Liberal MP Bruce Baird said. "Is that their payoff for selling an Australian icon?"
About 4500 Qantas employees are from Mr Baird's Sydney electorate.
Mr Baird will raise the issue with coalition MPs next week over the $11 billion buyout bid from the Airline Partners Australia consortium.
Nationals senator Barnaby Joyce asked for the executives who would take on the bonus to resign.
"As soon as they accept that, they are no longer impartial in the process and should step down from any executive position," Senator Joyce said.

 

[JohnK]

Federal politicians have lashed out at senior Qantas executives who stand to acquire $300 million in bonuses.
Details emerged in a formal offer by corporate raiders bidding for the Australian airline, News Limited newspapers said..
The consortium revealed 11 Qantas executives would receive incentives equal to a 5.5 per cent stake in the new company.

Wow! It is becoming clearer everyday why QF senior management endorsed the $5.60 takeover bid!

In my opinion QF senior management and the current board should all resign immediately and the takeover bid withdrawn. If APA wishes to submit a fresh takeover bid then it will need to be reviewed and accepted by an independent panel.

 

[d15.in.oz]

Wow! It is becoming clearer everyday why QF senior management endorsed the $5.60 takeover bid!

And why shouldn’t they? The price is an awesome windfall for most Qantas stock holders! Job well done...

The only reason the bid should fail, is if the new investors think they would be able to service the debt. That would really only occur if –

• The barriers to market entry are significantly reduced (inspiring new competition)
• Existing market players are likely to take an aggressive expansion posture post takeover.
• Unionised staff are likely to majorly disrupt operations, ala BA!!!, thus disrupting debt serviceability.
• Major changes in air transport take place. (e.g market collapse, a new teleport device is invented, Internet exchanges become the norm)

If the government didn’t want the bid to go ahead, it can easily –

• Move immediately to a unilateral competitive open sky’s policy
• Offer incentives to stimulate an uncompetitive market, by wooing current smaller players to expand
• Reappraise its workplace reforms

Qantas, from my perspective on the sidelines, has some of the savviest business people on their payroll. And while enormous staff payouts - to a few decision makers at the top, is (at the least) provocative, it would only be on the carrier’s collapse that we would see them held to account for their scale.

 

[serfty]

... If the government didn’t want the bid to go ahead, it can easily –...

... Declare it invalid under the Qantas Sales Act.

The conditions of this act are absolute: have to be meet. The main condition here is that no single foreign "Entity" can have more than 25% of Qantas.

Using jiggery pokey, smoke and mirrors the voting shares in the APA have been set up so that Texas Pacific and Onex, the two 'active' foreigners, have a combined vote of 24 per cent even though their actual stakes add to 37½ per cent.

The government could simply deem that this 24% is b¤lldust, the acual figure is 37½% and we can all go home ...

 

[QF WP]

The largest foreign investor in the consortium bidding for Qantas has conceded it is open to the idea of spinning off some of the airline's non-flying assets...

 

[QF WP]

This news article (presuming it goes ahead) should make most people happy:

The private consortium bidding to buy Qantas has moved to defuse a looming political row by agreeing to have its $11 billion proposal scrutinised...

 

[d15.in.oz]

...Using jiggery pokey, smoke and mirrors the voting shares in the APA have been set up so that Texas Pacific and Onex, the two 'active' foreigners, have a combined vote of 24 per cent even though their actual stakes add to 37½ per cent....

Absolutely agreed! Problem is - some major precedents have been set; for example in the media industry involving CanWest and Channel Ten.

If you believe that foreign investment is part of the key to Australian domestic growth, the government taking that action would have a significant detrimental effect on all our futures. (As future foreign investment in this country could dry up.)

Additionally, given the premium that the foreigners are prepared to pay, relative to the market price before the bid was launched, a large amount of new parochial funds would be released, for re-investment in other areas of the Australian economy. (Hopefully in the south-eastern states, which are teetering on technical recession.)

... conceded it is open to the idea of spinning off some of the airline's non-flying assets...

As a customer in the domestic airline market, I think this would be great! [If the sum of it’s parts are greater than the value of it as a whole, do it.]

My wish list would be CityFlyer, Eastern, Sunstate, Southern… etc, all being sold off as separate airline businesses! Can you imagine how good the competition would be in the future? Let’s remember, the brand of Qantas - as an airline, has been many things over time. Flying again domestically has only been a recent addition.

 

[NM]

As a customer in the domestic airline market, I think this would be great! [If the sum of it’s parts are greater than the value of it as a whole, do it.]

My wish list would be CityFlyer, Eastern, Sunstate, Southern… etc, all being sold off as separate airline businesses! Can you imagine how good the competition would be in the future? Let’s remember, the brand of Qantas - as an airline, has been many things over time. Flying again domestically has only been a recent addition.

But the information is that they may consider selling of non-flying assets. To my knowledge CityFlyer, Eastern, Sunstate abd Southern do not fit into the non-flying assets part of the business.

Some example of non-Flying Assets would include Qantas Holidays, Qantas Maintenance, Catering, Cleaning, Ground Handling, Airport operations, IT, Frequent Flyer program etc.

 

[Takeshi]

How can you trust these guys, in their Bidders Statement they said the buyout of Qantas has no plans for any assett sales, or sale of Qantas's Buisness units.
Now suddenly 3 days later, TPG boss has not ruled out the spinning off or sale of Non-Airline buisness units inc FF.

I smell a big rat here, I hope costello stops this on National Interest grounds.
These guys are not here to grow Qantas, no they are here to make a quick buck, and thats all.

Cheers

 

[Mal]

spinning off some of the airline's non-flying assets...

Aaah, so they're going to sell off all of their A380's hey?

 

[d15.in.oz]

To my knowledge CityFlyer, Eastern, Sunstate abd Southern do not fit into the non-flying assets part of the business.

So true... was only a wish list.

 

[moa999]

...
The conditions of this act are absolute: have to be meet. The main condition here is that no single foreign "Entity" can have more than 25% of Qantas.

Using jiggery pokey, smoke and mirrors the voting shares in the APA have been set up so that Texas Pacific and Onex, the two 'active' foreigners, have a combined vote of 24 per cent even though their actual stakes add to 37½ per cent..

No smoke whatsoever here...
The simply prevent any individual entity holding more than 25%... TPG and Onex are very separate.

In any event TPG and Onex will add to 37.5%,
versus the 47/48% that foreign funds/ investors (and BA for a while) have held for the last few years

so the overseas ownership actually goes down

 

[JohnK]

.... has conceded it is open to the idea of spinning off some of the airline's non-flying assets...

Really! How could anyone have guessed that this could possibly be on their agenda?

Will there be anything left when this mob is finished?

Shares in a LCC anyone?....

 

[JohnK]

No smoke whatsoever here...
The simply prevent any individual entity holding more than 25%... TPG and Onex are very separate.

Separate? I am sorry but to this amateur a 37.5% holding stake in a company does not equal 24% voting rights in same company.

 

[Kiwi Flyer]

Separate? I am sorry but to this amateur a 37.5% holding stake in a company does not equal 24% voting rights in same company.

Ownership and voting rights are separate things, not to be confused. For example NZ government owns 1 share of Telecom, an infinitesimal ownership stake, yet that one share can outvote all the other shares combined for certain purposes.

It is the voting rights that determines control.

 

[JohnK]

It is the voting rights that determines control.

I agree with you and I understand.

But I believe in this instance the question needs to be raised whether 2 or more separate companies have collaborated to get around the maximum 25% ownership limit imposed on any company through the Qantas Sale Act.

By my calculations 37% does not equal 24% therefore these 2 companies should be treated as one and not separate as the ownership clause on the Qantas Sale Act has been breached.

As usual that is only my interpretation and YMMV.

 

[simongr]

My test for whether they should be treated as one is whether either party can sell its share without the approval of the other party - if they can then neither paryt is able to exter control or significant influence and thus would not be accounted for as a single entity.

 

[serfty]

No smoke whatsoever here...
The simply prevent any individual entity holding more than 25%... TPG and Onex are very separate.

In any event TPG and Onex will add to 37.5%,
versus the 47/48% that foreign funds/ investors (and BA for a while) have held for the last few years

so the overseas ownership actually goes down

Sorry aubs ... wrong bus ...

In reference to "smoke and mirrors" it was relating to general, not foreign ownership.

The pertinent rule is that no one shareholder can have more than 25% ownership of the company. And they can't get around it by splitting a bigger holding into bits - all 'associates' are grouped together. The specific Qantas Sale Act is definite about this. If the bidders are deemed to fail in this aspect, they can't make the takeover.

APA are aware of this and are trying to cloud this issue by implying that particular provision relates to control, not ownership; as such they feel the can get around it by restricting voting rights of some partners.

All the government needs to do is deem the investors are associates of the one entity and this 'entity' actually has 37% ownership and that's the ball game.

 

[NM]

How can you trust these guys, in their Bidders Statement they said the buyout of Qantas has no plans for any assett sales, or sale of Qantas's Buisness units.
Now suddenly 3 days later, TPG boss has not ruled out the spinning off or sale of Non-Airline buisness units inc FF.

I smell a big rat here, I hope costello stops this on National Interest grounds.
These guys are not here to grow Qantas, no they are here to make a quick buck, and thats all.

Cheers

Two very different statements here, which as not necessarily on conflict. The bidders statement say there are no plans to split it up. The comment from TPG boss is that they may consider it at some stage. It is perfectly feasible to have no plans now and to consider doing it at a later time.

However, even though the statements may be accurate, they could be considered a little misleading by some people.