Qantas has bought 20 per cent of Alliance Aviation and wants to grab an even larger stake of the regional charter service.
On Friday Qantas announced it paid $60 million for a 19.9 per cent stake in its long-term charter provider and, while it is not asking for board representation just yet, is likely to ask permission from the competition watchdog to buy more.
“Qantas expects to ultimately seek regulatory approval from the ACCC to build on its current shareholding, with a longer-term view of taking a majority position in Alliance Airlines in order to better serve the charter market,” Qantas said.
Alliance told the ASX it had yet to receive an approach from the national carrier.
“The board has not received any approach from Qantas at the time of this media announcement,” Alliance said.
Alliance’s three largest shareholders at the end of 2018 had been NZ’s Kiowa Two Thousand Corporate Trustee Company, German carrier Lufthansa and Perpetual, with 10.58, 8.07 and 8.04 per cent stakes respectively.
Qantas bought the shares on market at an average $2.40 per share, and a substantial shareholder notice released two days ago showed Perpetual trimming its stake to 7.03 per cent.
In an internal note on Friday, Qantas chief executive Alan Joyce said the company wasn’t pushing for involvement in the management of Alliance just yet, and wasn’t seeking a seat on its board as a result of the transaction.
“Similarly, there is no impact on our own operations or our commercial arrangements with Alliance as a result of this announcement,” Mr Joyce said.
“Ultimately, we’d like to take a majority stake in Alliance … this would involve a complex regulatory process and approval from the ACCC – so, it is a long-term proposition that we’ll work towards”.
Alliance, which will release its half-year results to the market next week, employs 575 full-time staff and has bases in Brisbane, Townsville, Cairns, Melbourne, Adelaide, Perth, and Darwin.
It services the mining, resources, tourism and government sectors.
At 1345 AEDT, Alliance shares were trading 8.7 per cent higher at $2.50, while Qantas’ shares dipped 0.83 per cent to $5.395.