Operation Piccolo plays familiar tune

By FRAN O'SULLIVAN

Qantas Airways launched Operation Piccolo - its opportunistic play for control of Air New Zealand - on Friday afternoon.

The "no numbers" takeover bid - a carbon copy of an unsuccessful strategy launched by former Qantas chief James Strong in April last year - was formally conveyed to Air New Zealand's board in Auckland.

But the Qantas play was not disclosed to the market until Air New Zealand had set up an independent directors' committee over the weekend to consider the concept.

Air New Zealand chairman Sir Selwyn Cushing took legal advice on his own position.

He has stepped aside to avoid conflicts of interest posed by Brierley Investments' proposed sale of its airline stake to Qantas.

Last year's Qantas push to gain a substantial stake in Air New Zealand - dubbed Operation Cloud by senior management - was foiled when Singapore Airlines was given Government permission to increase its stake to 25 per cent.

The Qantas move - said to be brokered by investment bank ABN Amro - faces a tough hurdle.

On July 1, New Zealand's new takeover laws will come into effect.

They will require any shareholder that reaches a 20 per cent stake in a company to make an offer for outstanding shares.

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