~ Le Viêt Nam, aujourd'hui. ~
The Vietnam News

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Qantas confirms stake in Vietnam's Pacific Airlines

SYDNEY - Australian flag-carrier Qantas confirmed Thursday it had signed an agreement to buy a 30 percent stake in Vietnam's Pacific Airlines, ending months of speculation about the deal. Qantas chief financial officer Peter Gregg said the Australian airline would help Pacific develop a business plan to re-position itself as a low-cost carrier both internationally and within Vietnam.

He said that under the deal, Pacific would "harmonise" its operations with Qantas's discount offshoot, Jetstar. "This will be an important investment for the Qantas Group, supporting Jetstars growth strategy and enabling us to extend our reach in Southeast Asia, where we have been actively exploring opportunities," Gregg said in a statement. He did not reveal the value of the 30 percent stake -- the maximum allowed under Vietnam's foreign investment rules -- which the Australian Financial Review this week estimated would cost 50 million dollars (41.5 million US).

Vietnam's State Capital Investment Corporation (SCIC), the main shareholder in Pacific Airlines, said in the statement that it chose Qantas because it was one of the best airlines in the world. "In particular, Qantas had developed Jetstar into one of the most successful low-cost carriers in Asia," SCIC chairwoman Le Thi Bang Tam said. Gregg said Qantas would be actively involved in managing Pacific Airlines through board representation and executive appointments. Qantas confirmed in January that it was engaged in talks on buying a stake in the Ho Chi Minh City-based airline. The Financial Review reported this week that the private consortium bidding to take over Qantas had approved the deal.

The Qantas announcement was made after the Australian Stock Exchange closed, with the airline's shares closing down 0.01 at 5.35 dollars in a rising overall market.

Agence France Presse - April 26, 2007.