Monday, February 26, 2007

[qantas buy out] what's the role of government

Americans are set to buy out Qantas, Australia's national carrier and the second longest running national airline, after KLM. There's a hue and cry over this, downunder, as you'd imagine.

In a television interview, Mr Howard said the state could not dictate who bought and sold shares in private companies:

"We cannot have governments deciding which shares can be sold and which can't and, in the end, that is what some people are advocating," he said. "Once you go down that path, then I think you begin to alter in a quite major way that nature of the economy that we operate in."

So, what do you think, in principle? Actually, I suspect Howard's letting it be sold because of that hostess in the toilet, who's now possibly pregnant. Can't have a national carrier allowing that type of behaviour, can you?


Colin Campbell said...

It's a little bit of Jingo and a bit of global capitalism. Qantas is a real Ozzie icon and the politicians can play it for all it is worth. Seems that they are developing Jetstar, the low cost part of Qantas to get some of the costs out of the businesss. The pilots union were spewing yesterday as many will be shunted on to lower contracts through Jetstar. The other concerns are the exporting of jobs and the humungous debt load (70 percent) that the consortium are proposing. The current management, who are going to be retained are going to make a bucket load of money when this goes through. Seems to me, that Qantas is a very strong brand and that the new buyers will want to preserve that. They are just about to get serious competition from Tiger Air, who are going to start a genuine low cost airline in Australia later this year.

CityUnslicker said...

If you are clever enough to persuae PE to invest in Airlines then good luck to you.

They are the worst investment ever and never fail to lose money in the long-term (national carriers that is, not the low-cost newbies).

No doubt Qantas will encounter problems and be a loser for the new investors. In the meantime current shareholders will have made a pretty penny.

Shame more politico's are not as switched on.