News: Victoria offers aid to Fox-Lew

 
Old Feb 14, 02, 8:23 am
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News: Victoria offers aid to Fox-Lew

Victoria offers aid to Fox-Lew
By Mark Westfield
15feb02

VICTORIA'S Bracks Labor Government is understood to have offered a $90 million cash incentive to Lindsay Fox and Solomon Lew's Tesna consortium to help them buy the struggling Ansett and keep it flying.

Alternatively, they could have taken more money in the form of fee relief and subsidies, but are understood to have opted for the cash.

This figure is far higher than industry estimates. The parties will only say they are in negotiations.

Tesna's bid for Ansett was still balanced on a knife edge last night with the Sydney Airports Corporation reluctant to sign an all-important lease over the Ansett terminal for Tesna.

SAC is understood to want a guarantee that Ansett will pay a full year's lease, a figure estimated at $50 million. The Sydney lease is critical to Ansett's operations as it will be the airline's busiest terminal.

There is mounting pressure too on the Ansett administrators, Mark Mentha and Mark Korda of accounting firm Andersen, to complete the mooted sale to Tesna in the coming days. On Tuesday Justice Alan Goldberg in the Federal Court in Melbourne refused to grant the administrators an indemnity from the airline's continuing losses until they complete the sale to Tesna.

If the proposed sale collapses, as seems possible, then the administrators may be liable for the airline's losses and any shortfalls of payments to creditors.

The administrators have admitted the airline is losing $6 million a week, but accord ing to The Weekend Australian's columnist Terry McCrann the losses are as high as $1.5 million a day, or $10.5 million a week.

Messrs Korda and Mentha will be pressing Tesna to complete their purchase as quickly as possible to avoid the possibility of Andersen being liable for Ansett's losses.

Andersen is under pressure elsewhere over its auditing work.
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Old Feb 14, 02, 4:23 pm
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How much did DJ squeeze out of Mr Beattie?
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Old Feb 14, 02, 5:08 pm
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Steve Bracks has denied giving out $90 million. AN is getting tax concessions, estimated to be worth $30 million.

It's being given out on the basis that if AN were not operating, the State Government would have nothing.

Cheers,

Justin
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