Cullen interview with TV1 On Air New Zealand

4.35 p.m.

Q. Qantas has said no to Ansett, what ….about Ansett's likely future?

MC Air New Zealand is now moving to seek some sort of arrangement via the Australian Government…
It does emphasise that Ansett is in serious trouble, as we have been trying to indicate.

Q. Does it suggest though that if the Australian government doesn’t take this extraordinary precedent…[indistinct]

MC that’s been on the cards for sometime and its up to Air New Zealand to make a final decision, its always been a possibility

Q. What do you think the Australian government may do now because clearly this complicates if not delays matters?

MC They will want to look very carefully at it. There is significant problems [with it] it is their second major local carrier, it provides provincial routes – some of which are not covered by Qantas, and of course they are coming into an election campaign which makes life particularly difficult for the incumbent government. On the other hand there may be substantial costs in the kind of indemnity Air New Zealand is looking for. So we are in close contact with Mr Anderson's office….and no doubt they will keep in close contact with us.

Q.Does this prevent, given you don't have certainty about the Ansett part of the equation, does this prevent you from signing off the rescue package tonight?

MC. Well, we hope that we are still able to receive from Air New Zealand a coherent package that we can find acceptable. This has been going on for far too long, and contrary to what's being claimed by some people, it is not the government that has been delaying and extending this process. Clearly Air New Zealand has to make some sort of plausible statement tomorrow accompanying its financial statement. I think that plausible statement will be much better if it has a clear package which has been signed off.

Q.Do you expect to sign off when there is some much uncertainty about Ansett?

MC It does complicate matters, obviously, with that uncertainty remaining around Ansett…..I will be getting more advice on this later, we have a Ministers' meeting…as it remains the government is very keen to try to get a resolution.

Q.At the very least, what could happen tomorrow?

MC Well, particularly from Air New Zealand there has to be a plausible statement- which gives the creditors of Air New Zealand confidence about its future.

Q. [what about the]Qantas development?
MC Its one that we expected. We always thought the chances of Qantas buying Ansett were very much less than 50-50 so we are not surprised by this development.

Q.But it does expose whatever rescue package the shareholders are part of, a greater financial risk if Ansett is liquidated?

MC Certainly a greater financial risk than if Qantas had bought Ansett, yes.

Q.So the next 24 hours is likely to [be important]?

MC. I would hope so, but I have been thinking that for each of the last 24 hours.

ENDS

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