Jackson may stay on at Qantas
A report by Michael Evans in the Sydney Morning Herald today says that he does not like to see anyone move out of a well-paid position and that Margaret Jackson always said she didn’t want to give up the gig as Qantas chairwoman.
He goes on to say, “Good thing for her, then, she might not have to. Not yet, at least.”
He adds:
In a speech 10 days ago, Jackson mused: “In achieving this great outcome for shareholders, I was also giving away the best job of my life so far.”
Turns out a few shareholders actually don’t agree selling the airline to private equity is such a “great outcome”.
So if the bid doesn’t get across the line, where does that leave Jackson and her fellow independent directors, who thought it was such a great deal? Directors, that is, of the calibre of Jackson, James Packer, James Strong and General Peter Cosgrove.
Could the board really continue functioning after major shareholders rejected its recommendation on the bid, alongside a spurned management led by Geoff Dixon that lost the chance to earn tens of millions under the buyout?
Jackson’s speech was full of tough talk of how the deal unfolded: “I gave Airline Partners Australia 48 hours to make a formal offer to acquire 100% of Qantas. If they were serious, now was the time to act.”
After receiving the initial $4.50 per share bid: “We rejected both the offered price and the conditions attached and we stated this clearly, publicly and immediately.”
When they got back together: “Intense negotiations were … hard and challenging.”
The result was an extra 10c, totalling an impressive 61% above the shares’ trading price over the preceding six months and that was enough for the independent directors to “feel delighted to recommend to our shareholders”.
But the message from the big end of town is they rolled over too easily: particularly after two profit upgrades as fuel prices came down and talk of a massive upswing with the airline now reporting near 90 per cent load factors.
Despite all the table thumping, why should private equity enjoy all the spoils?
Worse for the directors, having signed the deal, they now have no involvement in getting the bid across the line, even while shareholder action questions the wisdom of their decision.
A report by The Mole from material in the Sydney Morning Herald
John Alwyn-Jones
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