Qantas bid lodged this morning
Steve Creeedy, one of Australia’s leadign aviation writers reveals in the Australian this morning that the consortium moving to take over Qantas was expected to bring the agnoinsing wait to an end by lodge its $11b bid early this morning.
Sources close to the deal said the consortium was concluding its debt negotiations and was preparing to lodge a bid that would see Texas Pacific Group as the leading international partner and David Coe’s Allco Finance Group leading the Australians.
It is believed the bidders were waiting for US financial giant Citigroup to join the financing for the bid, meaning the consortium needed to link up with New York in the early hours of this morning to finalise the financing package.
Allco is now proposing to take at least 20% of the airline after Pacific Equity Partners pulled out because it was deemed to be foreign-controlled.
Texas Pacific, Macquarie Bank and Canada’s Onex are still thought to be below 15% to avoid triggering regulatory investigations.
The deal has been subject to extensive negotiations between the bidders and Qantas advisers UBS and Carnegie Wylie & Co and subject to intensive legal scrutiny to improve its chances of acceptance.
“I would say this will be a pretty clean bid,” a source said last night.
Analysts are expecting the bid to be about $5.50 or above, but not as high as the $6 touted last week.
Qantas shares, which rose 4% on Monday on expectations the bid would be lodged, fell back slightly yesterday to close down 3c at $5.21.
Treasurer Peter Costello flagged last week that the deal would still have to be considered under the Foreign Acquisition and Takeovers Act.
However, industry observers believe Canberra would have a hard time knocking back the application because of the message it would send to other private equity firms wanting to invest in Australia.
Analysts also believe the Qantas board would be hard pressed to reject a bid at around $5.60 a share because Qantas shares have never traded above that level.
It is understood the bidders are canvassing major shareholders to gauge their reaction and analysts believe the board will be obliged to accept a bid in that price range.
Report by The Mole with information from The Australian
John Alwyn-Jones
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