A Remodelled Roo?

So after an initial rebuff a syndicate of Australian and international private equity firms has succeeded in its debt-financed “off market” bid to acquire 100 per cent of Qantas for $5. 60 a share, valuing the airline at over $11 billion. The consortium is led by Macquarie Bank (limited to a less than 15 per cent stake because of its ownership of Sydney Airport) and Australian private equity firms Allco Equity Partners and Allco Finance Group, teamed with giant US private equity firm Texas Pacific Group and Canada’s Onex Corporation.

The Qantas board initially rejected the bid, but a revised offer, worth another 10c a share, was accepted the day this magazine went to press. It appeared an offer too good to refuse, as the board members have one overriding responsibility – delivering best value to Qantas’s existing shareholders. Consequently current Qantas shareholders stand to do spectacularly well from the deal – remember Qantas’s share price was as low as $2. 93 in July.