Dixon admits – good thing Qantas takeover plan failed
According to Reuters in the USA, Qantas outgoing CEO Geoff Dixon has said the Australian airline was fortunate a massive takeover bid from private equity failed last year, although he strongly backed the deal at the time.
In an interview, Dixon said the $A11 billion ($US9 billion) deal from the consortium Airline Partners Australia (APA) had been “clouded by emotion”, as board members and management stood to make huge personal gains.
Had the takeover gone ahead, Dixon said, Qantas would now have been in serious financial difficulty, although he believed the airline would have survived.
One of the members of the APA consortium, Allco Finance Group, collapsed this month with debts of more than A$1.1 billion.
“It didn’t happen, and I’m very pleased now it didn’t happen,” Dixon told the Sunday Telegraph. “The real issue I’d never repeat was having the management – myself and the management – involved in it.
“The real Achilles’ heel was that it got very, very emotional – principally because I and the senior management team were going to earn tens of millions of dollars as part of it.
“That’s the way private equity works.”
APA, which also included Canada’s Onex Corp and Australia’s Macquarie Bank Ltd withdrew its bid in May last year amid lack of support from Qantas shareholders.
The bid’s failure forced former Qantas chairwoman Margaret Jackson to announce her retirement.
Dixon steps down later this month, when he will hand over to Alan Joyce, the former chief of the airline’s low-cost subsidiary Jetstar. In the year to June 2008, Qantas reported net profits of $A969 million, up 44% on the previous year.
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