Qantas eyes stake in Vietnam budget carrier
HANOI - Australian airline Qantas is in talks to buy a stake in Vietnam's second-largest carrier, Pacific Airlines, which is now transforming itself into a low-cost airline, according to a Pacific Airlines official.
"The deal is being discussed," said an official at Ho Chi Minh City-based Pacific Airlines, asking not to be named. "Nothing is specific at the moment."
Qantas chief financial officer Peter Gregg said Tuesday in Singapore that "we are very close to announcing a substantial investment in the region" but declined the say which airline Qantas was targeting.
He said Qantas was now carrying out a due diligence process with the Asian carrier, in which it could take only a minority stake due to ownership restrictions. Vietnam limits foreign ownership in Pacific to 30 percent.
Pacific Airlines, part owned by state-run Vietnam Airlines, plans to start low cost flights by mid-February, shortly before the Tet Lunar New Year holiday, the country's peak travel period.
To compete with regional budget airlines such as Singapore-based Tiger Airways and AirAsia, it will offer tickets starting from a little over one dollar for the Hanoi-Ho Chi Minh City route, state media has reported.
Its general director Luong Hoai Nam said the airline also planned to offer low airfares from Ho Chi Minh City to Taipei and Kaohsiung in Taiwan, the state-controlled Thanh Nien daily said this week.
Qantas is one of the world's most profitable airlines with net profit of 479.5 million Australian dollars (378 million US) in the year to June 2006.
Agence France Presse - January 25, 2007.
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