TravelNewsAsia.com

 

Travel News - Latest Travel News

 

Speakers Notes from todays Air New Zealand Press Conference re Qantas Proposal

Travel News Asia Date: 30 May 2001

A media conference was called today in Auckland where the Acting Chairman of Air New Zealand Limited, Dr Jim Farmer QC, and the President and CEO, Gary Toomey, addressed some matters arising from yesterday's announcement. The announcement was that Air New Zealand has received a proposal from Qantas outlining its interest in acquiring a significant shareholding in Air New Zealand from its two major shareholders - Brierley Investments Limited and Singapore Airlines Limited

The following are the speaking notes used:

Dr Farmer:

The Board of Air NZ has established an independent Committee of Directors to deal with this proposal, its ramifications, and other options that the Company might consider.

The Committee consists of Board members who are not directly associated with Brierley Investments or Singapore Airlines.

By resolution of the Board of Air New Zealand it is authorised to act in regard to any matter within the authority of the Board arising as a consequence of the proposal.

Air New Zealand is well equipped to determine how this proposal - and a range of other development proposals which Air New Zealand itself has had under development for some time - should be addressed in the best interests of all shareholders.

The Qantas proposal has commanded a great deal of attention - but it is far from being the company's only option.

At this point, the Qantas proposal has not been advanced to the company in the level of detail required for us to make a proper judgement of its merits.

We are currently waiting for answers to a set of preliminary questions that we have put to Qantas on basic issues which we must consider - in terms of the legal, constitutional, and regulatory constraints which apply to Air New Zealand as well as in any assessment of its contribution to the interests of our shareholders.

We will also be consulting the Minister of Transport - as holder of the Kiwi share in Air New Zealand - on shareholder issues relating to the interests of the Kiwi shareholder, who is required to approve the acquisition of shares in Air New Zealand by any foreign carrier.

We are not under any pressure to complete the process of assessing this proposal and other options available within a specific time frame - our duty is simply to act in the best interests of all the shareholders of the company.

This is simply one more proposal to add to the range of options available to Air New Zealand as we proceed to chart the medium term future of the company. And we do not intend to be distracted in any way from maintaining the fundamental health of the company while we deal with it.

Please : do not expect a running commentary - or blow by blow account - of our deliberations. We are operating in a highly competitive commercial environment. We will make further announcements as and when we consider there is a material development to report - and it is necessary in the interests of shareholders and investors to do so.

While Gary Toomey and the management team are supporting the Independent Committee in its deliberations on this matter - I assure you our first priority remains preserving and building the underlying health and strength of the Air New Zealand - Ansett Group, while we determine the best option to take the business forward.

I now call on Gary Toomey to speak.

Gary Toomey:

First - I'd like to congratulate my former colleagues at Qantas for recognising the strengths of Air New Zealand and the virtues of developing an effective Australasian airline system.

Dr Farmer has outlined the careful processes that the full Board of Air New Zealand has put in place to ensure that the interests of all shareholders receive proper consideration as the Qantas proposal is addressed.

It as an interesting addition to the range of medium term development options that the new Air NZ-Ansett management team has been developing for our Board's consideration at its June and August meetings.

I certainly support Dr Farmer's point that this proposal - along with all the other options, which we are developing but not announcing for obvious commercial reasons today - will be ultimately be judged in terms of how it advances the best interests of the shareholders of Air New Zealand.

The company is under no pressure that requires us to deviate from the strategic development programme that we have been pursuing.

Air New Zealand is not strapped for cash ... it has more than adequate cash to meet its ordinary requirements.

It has not approached the Government for a bail-out .... And it is not developing any plan to do so.

We expect to have $1 billion in cash by the end of June - with the majority of that in hand already, and some asset realisations still to be made that are progressing on track.

We're in good shape to meet current requirements.

We are currently exploring our funding options to support medium-term development programme to build a highly competitive, integrated domestic and international airline business - from the perspective of consumers, investors, and employees.

The Company currently has a share structure that constrains its ability to raise capital from the global market by way of equity - a problem that we share with Qantas.

Looking to our medium term requirements, over the next five years, it will be matter of political judgement - both here and in Australia - as to the future form and level of constraints on our access to foreign equity investors over the next five years.

The international trend is for more liberal attitude towards national ownership and control issues - but we can all speculate about how far that will go ... Equally speculatively, we've given some consideration to one funding option that involves asking the Government to consider some transitional funding arrangement in the event that international attitudes towards the ownership and control issue haven't moved far enough to give us adequate equity raising ability.

I'm disturbed at the degree to which this very speculative internal discussion has been misinterpreted into us seeking a Government cash bailout .... being strapped for cash - and desperate for outside help .... Nothing could be further from the truth.

This is a company with many options. Now there is one more on the table for consideration. We're in a situation where we have a broader range of choice than ever before - and that in itself has a way of opening up even more options... as we have been finding over the last 24 hours.

I'm very confident that Air New Zealand & Ansett now have a brighter future than ever.

Subscribe to our Travel Industry News RSS Feed Travel Industry News RSS Feed from TravelNewsAsia.com. To do that in Outlook, right-click the RSS Feeds folder, select Add a New RSS Feed, enter the URL of our RSS Feed which is: https://www.travelnewsasia.com/travelnews.xml and click Add. The feed can also be used to add the headlines to your website or channel via a customisable applet. Have questions? Please read our Travel News FAQ. Thank you.

     
 
Copyright © 1997-2024 TravelNewsAsia.com