Ansett staff to lodge bid for airline

 
Old Oct 11, 01, 1:30 pm
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Ansett staff to lodge bid for airline

By Virginia Marsh in Sydney
Published: October 11 2001 16:42 | Last Updated: October 11 2001 17:23
A group of former Ansett employees is on Friday expected to lodge a proposal to buy the failed airline with the aim of rebuilding it into a full-service carrier with a comprehensive network.

Anstaff, a pilot-led employee syndicate, is one of up to five groups that have expressed interest in acquiring the airline that was placed in voluntary administration by its owner, Air New Zealand, a month ago.

Until now, however, Andersen, the administrator, has concentrated on securing the involvement of Singapore Airlines. It is due to hold further talks this weekend with SIA, which has been asked to prepare a business plan for Ansett and to consider both managing the airline under contract or taking an equity stake in it.

SIA said on Thursday it had no plans to take a stake in the new airline but was still considering the request by the administrator to take a consultancy role and draw up the business plan.

The airline said it was too early to decide on whether it would accept the offer to assume the management of the airline. SIA has temporarily managed two other airlines in the past, restructuring Sri Lankan flag-carrier Air Lanka in the 1980s and, in the mid-1990s, it managed the newly-formed Air Macau, based in Macao, the former Portuguese-administered enclave that returned to China in 1999.

But Anstaff, which is being advised by Deloitte Touch Tohmatsu, said yesterday it was close to finalising a syndicate of financial backers and that it had also approached SIA.

"The new Ansett will be a viable competitor for Qantas," said Graeme McMahon, a former Ansett chief executive who is advising the employee group. "We are not proposing a limited carrier with a much smaller number of former employees servicing only the domestic tourist market."

The proposal is understood to involve re-employing 6,000-7,000 of the 11,000 that worked in Ansett's core business and to hinge on outstanding employee entitlements, estimated at A$500m to A$1bn (US$250m-US$500m), being exchanged for equity.

This would leave the workforce holding up to 40 per cent of the airline.

Ansett resumed limited services nearly two weeks ago but is struggling to recapture its market share, which once approached 40 per cent.

Virgin Blue and Qantas, by far the country's biggest carrier, have moved quickly to capitalise on Ansett's demise, increasing capacity and matching some of the cheap deals the slimmed-down Ansett has been offering.

Qantas said yesterday that it was considering bringing forward the launch of Australian Airlines, a new, low-cost carrier, although its board had yet to give the new airline its formal approval.

An Australian lawyer said on Thursday he was planning a class action against Ansett and Air New Zealand on behalf of holders of the failed airline's frequent flyer points. Mark Kurtze, an Adelaide lawyer, said unused awards points held by Ansett customers were worth up to A$500m. The class action would also look at the liability of credit card issuers linked to the reward programme.




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