MELBOURNE - The private equity-backed consortium seeking to take over national carrier Qantas Airways Ltd with an $11.1 billion ($12.71 billion) bid says it is still committed to a full takeover of the airline.
Doubts over the bid's prospects of success intensified last week after a key institutionalshareholder said it would reject the offer by Airline Partners Australia (APA).
But APA spokesman Bob Mansfield said today the offer of $5.45 in cash for each Qantas share still represented attractive value at a time of increasing competition in the volatile aviation sector.
"APA is actively considering a range of options to ensure successful completion of its offer and will continue to keep the market informed," Mr Mansfield said.
"We urge all the remaining Qantas shareholders to accept the consortium's offer of $5.45 cash per share.
"The fact that one institutional shareholder has declined the offer in no way deters us from successfully completing this transaction with the overwhelming majority of shareholders who support it."
Mr Mansfield said 50 per cent of Qantas shareholders by number had already accepted the APA offer.
"The general consensus is that if this offer is not accepted, the Qantas share price will fall. Qantas shares have never traded at or above our offer price," he said.
Qantas shares closed at $5.06 on Friday, falling 16 cents.
Balanced Equity Management, which holds four per cent of Qantas shares, said last week that it would not accept the APA bid given the current strength in the stock market.
If other institutional shareholders take the same stance, the takeover bid could be scuppered because APA would be unable to reach its minimum acceptance level of 90 per cent of Qantas shares.
Mr Mansfield said aside from intense competition, Qantas had foreshadowed the need to spend $13 billion on new aircraft in the next few years, which was significantly more than the airline's market capitalisation.
Without the APA offer, the announcements on capital requirements and competition could be expected to pull down the Qantas share price.
