KEY POINTS:
Air New Zealand says it has agreed with Qantas to formally terminate the alliance plan between the airlines.
It also said Qantas would hold the equivalent of a 4.2 per cent stake in Air New Zealand through the conversion into ordinary shares of redeemable convertible notes issued by Air New Zealand to a subsidiary of Qantas in 2002.
The airlines had agreed to the formal termination of the Strategic Alliance Agreement, the Tasman Networks Agreement and all associated agreements, Air New Zealand said.
That followed the rejection late last year of their joint application to the Australian Competition and Consumer Commission for approval of the Tasman Networks Agreement.
The earlier Strategic Alliance Agreement was approved by the Australian Competition Tribunal but clearance was declined by the New Zealand Commerce Commission.
No action was taken by either Air New Zealand or Qantas to implement either agreement as conditions for implementation were never satisfied.
The conversion of the convertible notes issued by Air New Zealand was being done in connection with the termination of the agreements.
The issue of the ordinary shares was approved by the board of Air New Zealand at the time the notes were issued.
The notes would convert into 44.15 million ordinary shares, equivalent to about 4.2 per cent of Air New Zealand's total ordinary shares on issue.
- NZPA
