Forum Archive Index - August 2001

["tennyson@caverock.net.nz" <tennyson@caverock.net.nz>]

Hi Warner,

> 
>
> Hi Snoopy, on a mates computer and was just wondering why you are
> still holding the B's with that rather grim picture? 
>
>

Things may not be going according to management's original plans.  
But I don't think the picture is that grim looking from the current 
level of $1.30 for the B shares.

What I think will happen is as follows.   Half of Ansett will be sold 
off to Singapore Airlines.  This means Air New Zealand's share of the 
money for the fleet upgrade will be reduced to a more managable 
longer term $1 billion, or maybe even less when the link up with 
Virgin Blue happens (mentioned later on).  Retaining a half interest 
in Ansett will guarantee the feed of passengers from Ansett through 
to Air NZ domestically.  Virgin Blue will cancel their plans to float 
in Australia and will take up a 10% share in Air New Zealand (allowed 
under current rules) and will become Air New Zealand's discount brand 
in Australia.  This will further reduce the need for Ansett to fund 
their fleet upgrade as Virgin Blue has nice new planes.  This will 
tighten the B scrip nicely.

The result of all this means the duopoly in Australia is restored, 
landing rights issues are protected and a solid platform will be 
laid for future growth.

The cash issue will go ahead, I will take up my rights at a nice 
cheap price and the balance sheet will be restored to a solid 
position.  Hardly a longer term grim picture. 

The A shares however will be depressed for longer until Virgin sets 
up their New Zealand company (if they can set up Virgin Blue in 
Australia, why not Virgin Black in New Zealand?)  and buys out 
Brierley Investment's stake. SNOOPY





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"You can tell me I'm wrong twice, 
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