Virgin Australia has issued a sharply worded statement disputing Qantas’s assertions that it benefits from having foreign government owned airlines as its major shareholders.
“The proposition that Virgin Australia has access to cheaper capital by virtue of our shareholder base is completely false,” the statement reads, before noting that Air New Zealand and Singapore Airlines are both publicly listed companies “that are expected to make a profit and a return on their investments”.
It also gave Qantas a not so subtlely worded reminder that the current capital raising Virgin has underway “is a standard way that publicly listed companies raise funds”, an evident reference to reports Qantas is seeking federal government backing for its debt, or even a federal government shareholding in the once government owned airline.
“As a listed company, Qantas also has the ability to undertake capital raising activities. Qantas has regularly raised equity capital from global investment markets – in fact it has done so nine times over the past decade, generating funds of over $1.2 billion. Large globally-focussed institutional investors represent over half Qantas’ share register, which have tens of trillions of dollars available to invest in debt and equity markets.”
Of Virgin’s three major airline shareholders, Air New Zealand is 53 per cent owned by the New Zealand government with the balance of its shares traded on the NZ and Australia stock exchanges, while Singapore Airlines is 55 per cent owned by Temasek, the Singapore government’s investment company. Eithad is fully owned by the government of the UAE.
