Paul Phelan/CAIRNS
Air New Zealand (ANZ) has signed a Memorandum of Understanding (MoU) with TNT to acquire an initial 25% interest in Ansett Holdings for A$200 million ($151 million).
ANZ chairman Bob Matthew says, that a formal agreement on the two-stage A$425 million purchase, is expected "in the near future".
The MoU provides ANZ with the option of acquiring TNT's remaining 25% interest in Ansett Australia at any time until 15 February, 1998. If that is not taken up, TNT may re-purchase the initial 25% parcel for A$200 million within a limited time period. News Corporation is the other shareholder.
The investment and options require approval from the Foreign Investment Review Board in Australia and the Commerce Commission in New Zealand.
The latter will particularly want to hear about the future of Ansett's domestic operations in New Zealand, where it provides the only serious competition to ANZ.
Matthew says that the initial purchase will be funded from existing financial resources: "As at 30 June, 1995, Air New Zealand had cash and committed credit facilities in excess of NZ$850 million," he says.
Under the MoU, ANZ - still 19% owned by rival Qantas - will be protected against future Ansett Australia liability incurred through its guarantees covering obligations of the separately owned Ansett Worldwide Aviation Services aircraft-leasing venture.
The move was prompted by ANZ's desire to break into the Australian market following the collapse of the open-skies agreement between the two countries.
The day before the disclosure, Ansett announced that it will use spare capacity on its third Boeing 747-300 to operate twice-weekly flights for Aerolineas Argentinas between Sydney and Auckland from December.
The profitability of the capacity-share deal will be underwritten by the pre-sale of 300 of the 414 seats to the Argentinian carrier - which flies two services weekly between Buenos Aires and Auckland, but has no traffic rights between Sydney and Auckland.
The agreement replaces a charter operation by Aerolineas Argentinas of a Qantas 747. Ansett will sell the remaining seats and cargo space in its own right, providing the first-ever connection between its Australian and New Zealand domestic services.
Source: Flight International
