Qantas in talks to buy stake in Pacific Airlines

21-Mar-2007 Intellasia | Bloomberg | 7:11 AM Print This Post


Vietnam will soon sell a stake in its second biggest airline, Pacific Airlines, to Australian air carrier Qantas and the two sides are in talks for the purpose.

“We are in the final stages of negotiations,” Le Song Lai, deputy director-general of State Capital Investment, a strategic investment arm of the Vietnamese government, said.

“We are going to sign an agreement with Qantas, hopefully by the end of this month or in the first week of April.”

Pacific Airlines, now a budget carrier, said in January it was in talks with Qantas. Qantas said at that time it was looking to buy a stake in an Asian carrier.

“We are working closely to come to an agreement,” Qantas Chief Financial Officer Peter Gregg said in a statement read Monday by a spokesman in Australia who declined further comment.

Under the accord, State Capital Investment will retain a majority stake, said Lai, who refused to reveal the percentage of stakes or a possible price for the transaction. “They are going to become our solid partner,” he said.

Pacific Airlines was previously controlled by Vietnam Airlines Corp. and then by the Ministry of Finance before being transferred to State Capital Investment, which is controlled by the ministry.

In January, Pacific Airlines Deputy General Director Nguyen Khac Hung said the sale could involve a stake of as much as 30 percent.

Pacific Airlines is worth about $167 million, Vietnam News reported in January 2006, without saying where it got the information from. The carrier, which had four leased planes as of January, flies domestic routes and to Taiwan and Bangkok.

The move is part of Vietnamese government plans to speed up equitization of state-owned companies.

 


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