BREAKFAST DEALS: Qantas stumble

Qantas faces a battle to get its Emirates deal off the ground, while ConsMedia shareholders prepare to vote on News Ltd's bid.

The tables have been turned on Qantas Airways two years after it tried to get the competition watchdog to decline interim approval for its rival’s alliance with a Middle Eastern carrier. Consolidated Media Holdings has set a date for its News Limited takeover vote, with the ACCC to rule on Kerry Stokes’s hand 18 days before hand. Meanwhile, Bendigo and Adelaide Bank has gone the hybrid, NRW Holdings is feeling BHP Billiton’s Port Headland deferral harder than most and another theory emerges and Nathan Tinkler’s next move.

Qantas Airways, Emirates, Virgin Australia

Virgin Australia has filed a submission to the competition regulator urging the watchdog not to grant interim approval to the alliance between rival Qantas Airways and Middle Eastern carrier Emirates.

Great Scott! This sounds so familiar.

That’s because two years ago almost to the day, Qantas urged the Australian Competition and Consumer Commission, then led by Graham Samuel, not to grant interim approval to the alliance between Virgin Australia and Middle Eastern carrier Etihad Airways.

But there is a difference between the two moves.

Back in 2010, Samuel didn’t pay much attention to Qantas: "In granting interim authorisation the ACCC has taken into account the fact that Virgin Blue and Etihad currently do not operate any competing services, as well as the lead time required to market and sell tickets before the commencement of long-haul services.”

Now take a look at Virgin’s statement yesterday: "Given the number of overlapping routes and the respective market shares of [the two airlines] on those routes, there can be no question that there will be an impact on competition.”

What Qantas has to do that Virgin did not is convince present ACCC boss Rod Sims that those routes are headed the way of the Dodo. That’s admittedly a confused metaphor because while the kangaroo route was once profitable, the Dodo never could fly.

Consolidated Media Holdings, News Limited

The date has been set for Consolidated Media Holdings shareholders to vote on a $1.94 billion takeover bid from News Limited, the owner of this website. The meeting will take place on October 29.

The other important date to remember in this encounter is the consumer watchdog’s final decision on whether Seven Group Holdings billionaire Kerry Stokes can increase his 25 per cent stake in CMH. The Australian Competition and Consumer Commission is due to hand down those findings on October 11.

All but two board members recommended the $3.45 a share offer from News with the independent expert KPMG concluding it represented fair value.

In the absence of a superior proposal, majority shareholder and deputy chairman James Packer is voting yes, along with executive chairman John Alexander.

The other two directors that hold CMH stock, Rowena Danziger and Christopher Mackay, are also voting yes with their shares.

Unsurprisingly, those two board members were Stokes’s nominees, his right hand man Peter Gammell and son Ryan Stokes. They declined to make any recommendation.

Speaking of Seven, the company has offloaded its internet phone company Engin to Eftel Ltd for a price that would be on some level disappointing.

Seven got $9.1 million for the company that it paid $26 million for a 33 per cent stake in and later another $4.6 million for another 24 per cent.

The company won the rest through a share cancellation funded with Engin’s cash.

Bendigo and Adelaide Bank hybrid

About two weeks ago, this column wondered whether any of the other big four banks would follow Commonwealth Bank of Australia with a hybrid issue.

Shamefully, Australia’s other lenders were overlooked.

Regional operator Bendigo and Adelaide Bank is tapping the market with its own hybrid issue of $125 million.

The proceeds will mostly go to paying $89 million worth of reset preference shares that are currently on issue.

Bendigo and Adelaide said in its statement to the market that the notes would deliver the equivalent of an unfranked dividend rate of 8.53 per cent and 9.03 per cent, based on expected margin and current rates.

"(Convertible Preference Shares) are being issued to support Bendigo’s balance sheet growth and to ensure Bendigo continues to have strong regulatory capital levels,” the bank said in a statement. These issues qualify as tier-1 capital under the Basel III rules.

Bendigo could raise more from the issue if it so wishes.

NRW Holdings, BHP Billiton

Whether Australia’s mining boom is over or just losing its fizz, this is what the results look like.

Mining services company NRW Holdings told the market yesterday that it’s losing up to $80 million in revenue from the decision by BHP Billiton to pull the reigns on its Port Headland inner harbour expansion.

That’s coming out of a $120 million contract to upgrade the iron ore blending yards at the port. NRW said the decision would not impact its guidance of 15 per cent revenue growth for fiscal 2013.

NRW had to drop its profit forecast earlier this month when Fortescue Metals Group hit the brakes on its own expansion plans.

The common element is iron ore.

As has been widely reported, shares in mining services companies have taken a battering in recent months in anticipation of announcements like these.

Wrapping up

The Australian Financial Review suggests this morning that Nathan Tinkler might be considering another plan for Whitehaven Coal – a proxy battle for control of the board and management.

The newspaper points to sources that merely suggest that this might be under consideration at the moment so don’t get carried away. Tinkler has enough on his plate at the moment.

Meanwhile, embattled property firm Aspen Group has unveiled a heavily discounted $101.4 million capital raising to help its balance sheet as it conducts a strategic review.

The 597 million new shares will be thrown as investors at 17 cents a share, which is a 28 per cent discount to the last trading price.

In more comforting capital raising news, the AFR says that online comparison site iSelect has picked up $30 million from an oversubscribed private placement, with a listing on the ASX expected within a year. The raising gives the company and implied value of $350 million.

And finally, printer PMP Limited won’t be able to pass on a dividend to shareholders despite plans to raise at least $75 million from the sale and leaseback deal of some of its properties.

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