Qantas rejects Macquarie Bank - Texas Pacific takeover bid
13 Dec 2006
Australian carrier Qantas has rejected an $8.6-billion (A$10.9 billion) takeover bid from a consortium led by Macquarie Bank, made last month, as being inadequate.
Despite the unrest the takeover offer has generated among Qantas unions and politicians fearing job losses, Australian premier John Howard has maintained that the government would not change laws on foreign investments to block a takeover bid.
Australian laws prohibit investors from owning over 25 per cent of Qantas's equity and debar foreign companies from holding over 49 per cent. Foreign airlines cannot own more than a 35 per cent stake.
Accordingly, Macquarie has assembled a group of potential investors, including VC firms Texas Pacific of the US and Canada's Onex.
The possible change of ownership has led to an outbreak of nationalistic fervour in Australia, especially over the likelihood of 6,000 maintenance jobs being transferred to low-wage countries like India or China and the closure of unprofitable routes.
There are also fears that Macquarie and Texas Pacific will carve the Australian carrier and hive off non-core assets like its two airport terminals, catering arm and its holidays business.
