Qantas in play

[FA Mikey]

Investment bank Macquarie Bank Ltd. and private equity firm Texas Pacific Group have proposed to buy out Australian airline Qantas Airways Ltd. pushing its shares up as much as 21 percent.

"The approach is confidential and incomplete and is being investigated by Qantas," Qantas said in a statement, after a newspaper reported that a Macquarie-led buyout possibly worth A$10.3 billion ($7.9 billion) was in the works.

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[jimntx]

Now if AA were looking to buy another airline...QANTAS would be the one in my book.

 

[FA Mikey]

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The shares of Australia's marquee airline, Qantas Airways (QUBSF), tumbled 2.6% to A$5.09 (US$3.99) in trading on Dec. 13 after it rejected an $8.6 billion takeover bid from a group led by U.S. private equity outfit Texas Pacific Group and Macquarie Bank, a Sydney-based investment bank and the world's biggest private company manager of infrastructure projects.

The bidding group, which also included Australian buyout firm Allco Equity Partners and Canadian diversified manufacturer Onex (ONEFF), offered A$5.50 per share for 100% of Qantas, a profitable airliner with a 65% domestic market share and a major player on international routes in Asia. That represented a 20%-plus premium over Qantas' stock price in mid-November. In a statement released to the Australian Stock Exchange, Qantas however declared "the terms of the proposal are not acceptable."

The thwarted takeover attempt comes at a time of increased deal-making activity in the global aviation business that has been hit by heavy losses due in large part to the spike in oil prices earlier this year. However, the roughly 25% decline in oil prices since mid-July maybe changing the assessment of the industry's future prospects.