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SYDNEY - A consortium bidding for Qantas Airways Ltd. is still in talks with its bankers on a new funding deal to help overcome resistance to an A$11 billion ($12.65 billion) takeover, a source familiar with the deal said today.
The Australian Financial Review newspaper had reported that the consortium would lower the minimum acceptance level required for the takeover to 75 per cent from 90 per cent after striking a deal with the banks financing the bid.
"No such decision has yet been agreed," the source told Reuters.
The Macquarie Bank Ltd. -led group must announce by Thursday if it intends to extend its takeover offer for the airline beyond the April 20 closing date.
The proposed bid suffered a setback last month when a key shareholder said it would vote against the A$5.45 a share offer, making it difficult to win 90 per cent of acceptances, prompting new talks with banks financing the bid.
A 90 per cent acceptance level, which would allow the consortium to take full control of Qantas, is an important safeguard for debtholders raising A$8.4 billion to fund the buyout.
The Financial Review said it expected the consortium to announce the reduced acceptance level either late Tuesday or on Wednesday, when the Qantas board was also due to meet.
The paper also said it understood that agreements to issue 11 senior Qantas executives with equity in the airline of up to 5.5 per cent were also at risk under a revised bid.
The move would put a question mark over the willingness of a number of the airline's senior executives to remain at the airline, the paper said.
The bidding consortium also comprises private equity firm Texas Pacific Group, Allco Equity Partners , Allco Finance Group and Canadian investment firm Onex Corp. .
The sale of the national icon, dubbed the flying kangaroo, has been backed by the Australian government despite some political and union opposition.
- REUTERS
