KEY POINTS:
Air New Zealand shares had their biggest fall in three years yesterday, falling 5.5 per cent or 12c to $2.05, on fears Qantas will dump its enlarged stake in the airline on the market.
The Australian airline became Air NZ's second-largest shareholder after the Government yesterday in a final twist of the failed plan for the two companies to merge on Tasman routes. Qantas now owns shares worth $91.4 million or 4.2 per cent of the company.
As part of the original code share plan, Qantas was to have taken a 22 per cent stake in Air NZ and paid about $98 million for redeemable preference shares in 2002 in preparation for taking the bigger stake conditional on regulatory approval.
However, that agreement was formally scrapped yesterday and Qantas then redeemed the preference shares.
Market opinion is that Qantas is likely to sell the stake - particularly if it is bought by a cash-hungry private equity consortium in deals being worked through across the Tasman.
Either way, a 4.4 per cent stake is not strategically significant given the large majority stake owned by the Government.
