AIR NZ AND QANTAS START DISCUSSIONS ON ANSETT

The Board of Air New Zealand Limited has offered to sell its Ansett subsidiary businesses to Qantas Airways Limited and has entered into discussions with Qantas, the Acting Chairman of Air New Zealand, Dr Jim Farmer, announced today.

"Ansett is continuing normal operations and Qantas and Air New Zealand will continue discussions over the next few days on the terms of any acquisition of Ansett by Qantas.

"Any transaction would be subject to due diligence and approvals of the Australian and New Zealand Governments and regulatory approvals, including that of the Australian Competition and Consumer Commission.

"The Board of Air New Zealand expects to be able to make an announcement on the progress of the discussions with Qantas on, or before, Thursday 13 September when the company is due to present its annual results.

"Meantime, Air New Zealand, its major shareholders, Brierley Investment Limited and Singapore Airlines Limited, and the New Zealand Government are continuing to negotiate in good faith to finalise arrangements to provide on-going financial support for the operation of Air New Zealand international and domestic airlines operations," Dr Farmer said.