Do New Zealanders Care About Who Owns Air NZ

26 July 2002

Do New Zealanders Care About Who Owns Air New Zealand?

A boutique Wellington investment house is asking New Zealanders whether they really do care if trans Tasman rival Qantas comes on board Air New Zealand.

McDouall Stuart, has today launched a website www.investinairnz.co.nz to garner how much interest there is from ordinary New Zealanders in buying the Air New Zealand shares, should they become available to the public.

McDouall Stuart broker Chris Stone said his firm believed that, if the price was attractive, New Zealanders would invest in the airline and this would be in the best interests of the New Zealand economy and consumers. He said media commentators were speculating that Qantas could buy up to 25 percent in the national airline at a substantial discount to the current share price of 66 cents.

The website would ascertain how much support there is for investors to own shares in the airline with visitors to the site also being asked to give an indication of how much they would be prepared to stump up, given that the price for the shares has not be set.

The New Zealand Government pumped in $885 million to keep Air New Zealand flying last year in return for an 82 percent stake.

“The track record of successive governments in selling down State-owned assets was not particularly good and the Crown could have either achieved a higher price or a better return by retaining a stake,” Mr Stone said.

Mr Stone is also of the view that overseas investors were favoured in allocations ahead of New Zealand investors when Auckland International Airport and Contact Energy were privatised and sold off as initial public offerings (IPO).

Qantas’ motivation for wanting a closer relationship and a stake in Air New Zealand has been questioned by a number of leading commentators including Consumers’ Institute chief executive David Russell.

The real concern is that, despite both airlines being relatively small by world standards, the net effect would be a weakening at both the domestic and international levels and higher prices for air travellers and exporters shifting freight.

ENDS

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