A takeover bid for Australia's iconic flag carrier Qantas, potentially worth more than $8 billion, sent the airline's share price soaring to record levels today.
Qantas said it had been approached by Australia's biggest investment bank, Macquarie, and US-based private equity firm Texas Pacific Group on behalf of a consortium they represent. 'The approach is confidential and incomplete and is being investigated by Qantas,' the company said in a brief statement to the Australian Stock Exchange.
Shares in the airline took off after the announcement, eventually closing almost 15% higher.
Analysts said numerous hurdles would have to be overcome for the takeover to be successful, including a 49%foreign ownership restriction on Qantas itself and a limit of 25% for any single shareholder.
Australian Transport Minister Mark Vaile reassured the country the restrictions would stay and Qantas would remain predominantly Australian even if the airline was sold offshore.
Macquarie bank today issued a brief statement confirming that 'preliminary' discussions had been held with Qantas.
Qantas reported a net profit of $479.5m for the year to June - a 30% slump over the previous year, which was blamed on spiralling fuel costs. But shareholders were told at the annual meeting last month that earnings were expected to improve in the current financial year.
Qantas operates 213 aircraft serving 142 destinations in nearly 40 countries, carried more than 34 million passengers last year and employs over 37,000 worldwide.
Private equity groups have been active in Australia recently, buying into media giant Publishing and Broadcasting and Seven Network television ahead of a shake-up in media ownership regulations.
US-based Kohlberg Kravis Roberts last month made an unsuccessful $18.2 billion bid for Australia's second-largest retailer, Coles Myer.
