Watchdog clears Qantas for Ansett sale talks

SYDNEY - The Australian Competition and Consumer Commission, the country's anti-monopolies watchdog, has cleared Qantas Airway's participation in any talks to rescue troubled Air New Zealand subsidiary, Ansett Australia.

"The ACCC has had discussions with the parties and considered there was a risk that Ansett may cease trading," ACCC chairman Allan Fels said.

"The ACCC has not given Qantas the go-ahead to acquire any of Ansett's assets, but the ACCC will consider any proposals, from any parties, that are brought forward," he said.

Air NZ held sale talks with its top rival Qantas yesterday to sell its ailing Australian subsidiary, a move expected to raise serious anti-trust concerns.

A straight deal could give Qantas almost total control of Australia's $A10 billion-a-year domestic air travel market with a 90 per cent share and slash the number of operators to just two from four big carriers and two little ones a year ago.

"No such formal proposals have been submitted," Fels said.

New Zealand and Air NZ's main shareholders, meanwhile, continued discussions to forge a rescue package for Air NZ, even if it offloads troubled Ansett Australia.

The Government said today it was likely to allow Singapore Airlines to increase its stake in Air NZ.

Air NZ has, with SIA's backing, asked the Government to allow the Singapore shareholder to increase its stake to 49 per cent.

Air NZ's acting chairman Jim Farmer spent the weekend in crisis talks trying to hammer out a rescue deal with the Government, Air NZ's 25 per cent owner Singapore Airlines and Air NZ's largest investor, Brierley Investments, which holds 30 per cent.

Qantas was also in talks with Richard Branson's Virgin Blue, a smaller cut rate competitor, over the fate of Ansett.

Australian Transport Minister John Anderson has said the government believed the sale to Qantas was the best way to resolve the problems facing Ansett, which needs a fleet upgrade and has been hammered by high fuel prices, a weak Australian dollar and fierce competition.

- REUTERS

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