Asians eye Ansett's licence

SYDNEY - An Asian airline is one of a handful of overseas carriers looking to buy Ansett Australia's air operators certificate - effectively its licence to fly.

Mark Mentha, administrator for the failed Air New Zealand subsidiary, said yesterday that Ansett assets worth about A$350 to A$500 million ($407 million to $581 million) had been sold, and administrators were ahead of their plans to return 92Ac in the dollar to employee creditors, although the sale of the remaining 50 planes could take two years.

Speculation has risen in recent weeks that a third airline, most likely Singapore Airlines, could buy some Ansett assets and set up a domestic operation to challenge flagship carrier Qantas and Sir Richard Branson's discount carrier Virgin Blue.

"We've had quite a few inquiries from overseas airlines in relation to that air operators certificate.

"We've also had Virgin express interest in it," Mentha said. "I think the real issue is time. How long do we maintain the infrastructure versus how long it takes for these parties to [decide] at what point they'll enter the market."

Mentha said planes, manuals and maintenance facilities would probably be sold in a package to any airline which bought the certificate.

The fleet of 20 Airbus aircraft envisaged in the failed Tesna rescue plan could quickly be put back in the sky, provided a new operator met regulatory requirements, he said.

An A$3.5 billion rescue bid by Melbourne millionaires Lindsay Fox and Solomon Lew's Tesna consortium collapsed in March after months of negotiations, leaving administrators no choice but to break up the carrier.

"We're ahead of the programme in terms of value, but we won'treally know until the planesare realised as they're a bigpart of that balance sheet on returns to creditors," said Mentha. Non-employee Ansett creditors, owed about A$2 billion, are not expected to see any returns.

Meanwhile, Mentha said the sale of Kendell Airlines and Hazelton Airlines looked set to take place this week.

The regional carriers were caught up in the collapse of their owner, Ansett, in September.

"We are hopeful of signing the sale agreement this week," Mentha said.

Australiawide Airlines, a New South Wales consortium of aviation experts, has reached an agreement to buy and merge the former Ansett subsidiaries for an undisclosed sum.

The sale was negotiated with the administrators of the two regional airlines in Sydney with financial support from the federal and state governments.

However, Australiawide has said the 1000-strong workforce will be reduced to 600-650.

- REUTERS

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