iscover
Qantas and Alliance have officially walked away from a planned acquisition that would have seen the Flying Kangaroo purchase the primarily Queensland-based FIFO operator.
In a joint statement, the two airlines acknowledged there was “no reasonable path forward” for the deal after it was opposed by the ACCC, though Qantas will still own a 20 per cent stake in Alliance. The agreement that sees Alliance fly up to 30 E190s for Qantas will also continue.
“Both companies believe the acquisition would have created customer value without lessening competition in the highly competitive resources sector – particularly through the efficiencies created through a combined fleet of F100 aircraft,” the statement read.
“Qantas will continue to serve the growing resources sector through its existing charter operations; it currently has around 27 per cent of the total charter market.”
According to John Gissing, Qantas Group executive of associated airlines and services, Qantas will be exercising an option for four additional E-Jets under its agreement, which will bring the total number of E190s operated by Alliance on Qantas’ behalf to 26. The planes are expected to enter the Qantas fleet by April next year.
“Alliance is an important partner for the Qantas Group and the E190s have helped us open new routes across Australia,” said Gissing.
“These four new aircraft will provide additional capacity and connectivity in the domestic market.”
The competition watchdog finally opposed the Qantas takeover of Alliance in April after four delays, with ACCC Chair Gina Cass-Gottlieb saying it would likely substantially lessen competition and threaten higher prices and reduced service quality.
“Qantas and Alliance currently strongly compete with each other in markets where there are few effective alternatives. The proposed acquisition would combine two of the largest suppliers of charter services in Western Australia and Queensland,” she said.
“Flying workers in the resource industry to and from their worksites is an essential service for this important part of the Australian economy, so it is critical that competition in this market is protected.”
Richard Daniell
says:Qantas could hardly take the ACCC to court for this when the ACCC are taking them to court at the same time.
It’s been dead in the water for months.
Qantas still owns 20% and are also there biggest customer with the lease arrangement for 30 E190’s – so they can block anyone else anyway and effectively control them by stealth.
If Qantas broke its contract with them they would collapse.
So nothing changes.