AIR - Air NZ.

[RTFQ]

Thanks as always for your thoughts Roger Cheers

[IAK]

More on the Air NZ/ Virgin sell off from today's herald.... http://www.nzherald.co.nz/business/n...ectid=11616215

[iceman]

More on the Air NZ/ Virgin sell off from today's herald.... http://www.nzherald.co.nz/business/n...ectid=11616215

I think this article hits the nail on the head. AIR last week announced that it wanted out of Virgin which one has to assume they have lost faith in VAH’s strategy or at least the time it is taking. AIR says the codesharing will continue. But the remaining issue is that VAH needs more cash and where will it come from. Etihad and SIA could of course continue providing loans but that is not likely forever. They can not buy the AIR stake without making a takeover offer. So who is the potential buyer of the AIR stake. Another airline, maybe a Chinese one. If so, they will be more likely to want codesharing VAH with their own airlines, not AIR. Or it could be an American based airline but which one. It won’t be American Airlines which is increasing its footprint in our part of the World but works with Qantas in OneWorld.
Could we possibly see a Star Alliance (AIR, United, Singapore) takeover bid or is that too far fetched ? I think at the moment AIR is vulnerable with its extraction from VAH as the Australian market is very important to AIR. Certainly will be interesting to watch this closely. Happy to be out of AIR for now

[Beagle]

I guess the other possibility is if AIR can't get a satisfactory price they simply refuse to inject further capital into Virgin and either dilute their shareholding as the company is forced to issue shares elsewhere or perhaps AIR is playing a long game here and will pressurise its airline partners to dump Borghetti and have a really intensive review of the entire operation of VAH. What's the bet Borghetti is losing friends at a pretty fast rate of knots... Happy to hold a modest stake while this intriguing corporate drama plays itself out.

[winner69]

Might the Australia government / politics play a part?

Virgin i think have some exemptions about foreign ownership - which Qantas not all happy with

Dont know the ins of outs of such things but just wondering

[winner69]

A bidding war for Virgin would be a great outcome

Never underestimate how much 'strategic value' is worth, no matter how perilous the financials look

Roger, Luxon's halo is starting to shine again

[Beagle]

Rumour has it mate that he's been cleaning out a lot of the old dead wood at AIR...suppose a brave man would say Virgin the biggest piece of all

[winner69]

Rumour has it mate that he's been cleaning out a lot of the old dead wood at AIR...suppose a brave man would say Virgin the biggest piece of all

As long as he keeps his Chief Pilot he be right

Great story on Morgan in the Herald the other day on him

http://www.nzherald.co.nz/business/n...lery_id=159217

[Snow Leopard]

Looks like Luxon might have to go.


Best Wishes
Paper Tiger

[Beagle]

I strongly disagree PT. Luxon has made a bold call that VAH as an investment is toxic for AIR and I agree 100%. Rumour has it their senior bean counters, one of whom won the coveted CFO of the year at last year's Deloitte top 200 business awards had a good look under the hood for themselves and aren't impressed. Luxon can be a stroppy bugger...you need a bit of fire in your belly to run an airline and I think the 60 year old Borghetti hasn't got it. If you can't get rid of the dead wood Borghetti then the next best thing is to get rid of their stake in VAH.

I Borghetti position at VAH is tenuous at best.