KEY POINTS:
Qantas yesterday began picking up the pieces after the final, farcical, collapse of the A$11.1 billion ($12.5 billion) takeover bid by the private equity consortium Airline Partners Australia.
Amid calls for the head of airline, chairwoman Margaret Jackson, the board was late yesterday meeting to examine its options to provide "continuity and stability" and to revisit its three-year management plan.
The national carrier was also urgently examining its share register to determine the real extent of foreign ownership after estimates that as much as 65 per cent could be held by overseas investors, breaching a strict cap of 49 per cent on foreign holdings.
"Under legislation the majority of Australian ownership must apply to Qantas," Treasurer Peter Costello said yesterday, after the Government demanded answers from the airline.
"It must apply to Qantas as it currently stands, it must apply in relation to any new bidder. As far as the Government is concerned that is a legal obligation ... [and] we expect the Qantas board to manage that.
"And if the Qantas board hasn't done that, then the Qantas board will need to have a good explanation."
The board has blamed chaotic trading as last Friday's deadline for the APA offer neared.
"In view of the heavy trading in Qantas shares [a formal reconciliation of foreign ownership] has been more difficult than usual," Jackson said yesterday. "The process is being accelerated and Qantas will advise the market as necessary."
If the foreign cap has been breached the board will start shedding the offending shares, starting with the last to have been bought by overseas investors and working back.
Qantas was also bracing for market reaction to yesterday morning's announcement by APA that it would not pursue its claim that a clause in its bid required shareholders to offer all - not only part - of their holdings.
Analysts forecast a sharp initial drop in the airline's share price, although once the dust has settled there is an expectation that rosy profit forecasts, the release of its latest monthly traffic figures this week and the wider, international, strength of aviation stocks should help recovery.
Yesterday Qantas shares dipped to a low of A$5.13 when trading resumed after a one-day suspension, but fought back to close at A$5.22.
APA had offered A$5.45 a share.
Jackson said that with the failure of the bid it was time for Qantas to move forward.
She said APA's offer could not be renewed and any future offer would be treated as a completely new matter - a point also emphasised by Costello.
"This has been an extremely difficult process since the board decided to recommend APA's bid to shareholders," she said.
The board's priority now was the continuing successful operation of the company.
APA, while finally conceding defeat, yesterday continued to hold out the prospect of a renewed bid, one of several alternatives now being examined. The Australian-US-Canadian consortium said it believed the offer might have crossed the 50 per cent line by the close of the offer, triggering a two-week extension to enable it to try to reach the 70 per cent needed.
APA said it had established that "certain shareholders" had accepted the offer for less that their total holdings and that some had subsequently acknowledged that they should have put all their stock forward.
By the close of the offer at 7pm last Friday APA said it had known acceptances of 45.66 per cent, and a further 5.58 per cent - including those of US corporate raider Samuel Heyman - had been lodged after the deadline.
APA said investors holding a further 6.09 per cent had since said they would not object to it acquiring their holdings under the clause requiring all shares to be offered, giving a total acceptance of 57.42 per cent.
