Quantas Airways Ltd agrees to Onex Corp deal

Onex finally convinced the largest airline in Australia to accept their
offer of $11.1 billion, after being turned down previously. Quantas Airways
agreed to the take over, only after Onex and its partners revised their
conditions and settled for $5.60 a share. Due to the strict government
regulations, foreign owners are limited to owning 49 percent of the
airliner. Onex will receive a return investment of $445 million, with a
12.5 percent stake. Investors that are located outside of Australia may not
own more than a quarter, which puts Macquarie Bank and Allco, as the major
shareholders. A minor share will be owned by the Texas Pacific Group in San

The proud new owners are enthusiastic about the launch of Jetstar, which
will be the lower cost extension of Quantas Airways. They have very high
expectations for Jetstar, as the distances between major cities are great
and due to the overwhelming grip that Quantas Airways already has on the
Australian market. Quantas Airways also owns many other businesses and is
currently designing a strategy to lower costs. The cost reduction program
and the take over, has many employees very nervous, as they believe that the
new owners will out source the maintenance operations to lower wage
countries, even though the buyout firms have indicated this option has not
been considered.

The consortium has assured the public that Quantas Airways will remain
Australian and that Quantas management does not intend to break up the
airline that has become an Australian icon over the years. Bob Mansfield,
director of the Airline Partners Australia, said that everyone involved is
aware of the responsibility that now lies with them and reassured employees
that there are no plans to cut the regional services.

The Australian Prime Minister, John Howard, has also expressed his
feelings in regard to the take over, by remaining optimistic about the
carrier, and that the shareholders will take any changes in consideration
before implementing them. He has also stated that new investments into the
industry can be an advantage, but that the market will be the deciding