ATW Daily News

Key Qantas investor rejects Airline Partners Australia

Monday March 26, 2007

Airline Partners Australia's A$11.1 billion ($8.96 billion) bid for Qantas hit considerable turbulence Friday when Balanced Equity Management, which holds approximately 4% of the carrier, informed the Australian Stock Exchange that it would not accept the offer.

BEM MD Andrew Sisson said "equity markets have appreciated significantly" since APA launched its bid and that "given the current level of the share market, in the absence of an adverse development in relation to Qantas, or a fall in equity markets," BEM would not accept the A$5.60-per-share offer, according to press reports from Australia.

APA requires a 90% acceptance rate and had reached 29% Friday. It said it is "considering a range of alternatives in light of the announcement" and extended the offer to April 20 from April 3. Qantas stock closed Friday down 3.1%, according to reports.

BEM and UBS Global Asset Management, which holds 7%, both had indicated the offer price was too low (ATWOnline, March 1). APA repeatedly has said its offer was final. "We have not made our decision on the basis that [APA] will come back with a higher offer," Sisson told The Australian.

by Brian Straus

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