Qantas' full ownership of Alliance has synergy benefits - Jefferies

Alliance Aviation Services

06/05/2022 24:22

** Brokerage Jefferies (buy, A$6.81) says Qantas Airways'
 QAN.AX  purchase of the remaining stake in Alliance Aviation
Services  AQZ.AX  would unleash benefits for customers and
shareholders
    ** Qantas said on Thursday it would buy the 80% stake it
does not already own in Alliance Aviation Services for A$610.8
million ($443.14 million) in an all-stock deal  urn:newsml:reuters.com:*:nL3N2WW3KV
    ** Jefferies believes the deal would help Qantas expand
further into regional services as there is value in Alliance's
fleet and the flexibility 
     ** Brokerage says if the deal completes, synergy benefits
and the fleet flexibility benefits would make it beneficial for
Qantas customers and shareholders 
    ** However, Jefferies adds that despite the work done to
approve Qantas' 20% stake, the Australian Competition and
Consumer Commission (ACCC) is expected to commence a new
investigation for the full acquisition
    ** Says positive decision by the ACCC for Qantas' 20% stake
does not infer the same positive outcome would be given for 100%
of Alliance 
    ** 10 of 13 analysts rate the stock "buy" or higher, two
"hold" and one rates it "sell"; their median PT is A$6.38 -
Refinitiv data
    ** As of last close, stock up 12.8% this year

 (Reporting by Himanshi Akhand in Bengaluru)
 ((Himanshi.Akhand@thomsonreuters.com;))