Qantas to gain full control of Alliance Aviation to tap mining sector demand (updated)

Alliance Aviation Services

05/05/2022 24:14

(Updates with detail on deal, context)
    May 5 (Reuters) - Australian carrier Qantas Airways Ltd
 QAN.AX  said on Thursday it would buy the remaining 80% stake
in Alliance Aviation Services  AQZ.AX  for A$610.8 million
($443.14 million) in an all-stock deal to expand its footprint
in the charter business.
    Qantas, which bought a 19.9% stake Alliance in early 2019 https://investor.qantas.com/DownloadFile.axd?file=/Report/ComNews/20190201/02071925.pdf,
 said investors of the aviation services provider would receive
A$4.75 per share, which represents a more than 35% premium to
its last close and values the whole of Alliance at A$764.5
million.
    The deal allows Qantas to incorporate Alliance's charter
fleet and "efficiently" serve customers in the Australian mining
industry as the country opens up to foreigners, expecting an
influx of workers and increased activity in the sector. 
    "The resources sector continues to grow and any new tender
for airline services will be very competitive. It makes a lot of
sense for us to combine with Alliance to improve the services we
can offer," Qantas Chief Executive Officer Alan Joyce said.
    The Sydney-based airline has notified the country's
competition watchdog of the deal along with details of the
anticipated benefits to customers. The deal would require, among
others, the watchdog's clearance to go through.
    The Australian Competition & Consumer Commission (ACCC),
which investigated Qantas' 19.9% stake buy in Alliance in 2019
and made no antitrust objections, did not immediately respond to
a Reuters request for comment.


($1 = 1.3784 Australian dollars)

 (Reporting by Sameer Manekar in Bengaluru; Editing by Anil
D'Silva and Aditya Soni)
 ((Sameer.Manekar@thomsonreuters.com; Twitter: https://twitter.com/sameer_manekar))