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Qantas has signed a binding agreement with Japan Air Lines to divest its stock in Jetstar Japan.
Under the deal, initially announced in February, Qantas will sell off its interest in the airline, which will rebrand as a wholly Japanese-owned low-cost carrier and “allow the Qantas Group to redirect capital investment towards Qantas and Jetstar’s domestic and international operations in Australia”.
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Valued at JPY8.2 billion ($74.1 billion AUD), the deal is “expected to have an estimated gain of approximately A$115 million to items outside of underlying for the Qantas Group, predominantly in FY27”, Qantas says.
“Under the agreed structure, Development Bank of Japan Inc. (DBJ) will acquire an equity interest, entering as a new shareholder, while Tokyo Century Corporation (Tokyo Century) and JAL maintain their existing shareholding position,” the Flying Kangaroo said in a statement.
“The transaction will see the Qantas Group divest its minority (33.32 per cent) shareholding by way of a share buyback by JJP, and the DBJ enter as a new shareholder in JJP, with the transition expected to be complete by June 2027.
“The transaction will allow the Qantas Group to redirect capital investment towards Qantas and Jetstar’s domestic and international operations in Australia. The agreement will also support JJP’s transition to a Japanese capital-led ownership structure.”
The sale marks the end of 14 years of Qantas involvement in Jetstar Japan, which launched in 2012.
“We’re incredibly proud of the pioneering role Jetstar Japan has played in the low-cost aviation sector in Japan and sincerely thank our Jetstar team members for their unwavering commitment to maintaining excellent safety, operational and service standards for millions of customers,” Qantas Group chief executive Vanessa Hudson said in a February statement.
“We’re confident the new ownership structure will deliver greater value to customers, benefitting from the Development Bank of Japan’s domestic and international aviation knowledge and industry expertise as well as its strong, long-standing relationships with national and regional tourism bodies.
“We thank Japan Airlines for their strong partnership and look forward to continuing to work together during the transition and in oneworld.”
The move comes after Qantas closed down Jetstar Asia in July last year, blaming “rising supplier costs, high airport fees and intensified competition in the region”, and shifted the airline’s A320 fleet to support its Australian and New Zealand operations.
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