Qantas eyes company split

Australia’s national carrier is considering a major shake-up of its business, which could see its domestic operations separated from its international arm as it chases more offshore investment, Fairfax Media reports.

The speculation comes as Qantas Airways (QAN) prepares to announce the outcome of a major strategic review next month, with much of the previous discussion focussing on the prospect of a demerger or partial sale of its frequent flyer division.

However, the slight change to the Qantas Sale Act last week to allow for increased foreign investment is believed to have led the airline to more strongly consider a split of its international and domestic operations. Such a plan would echo a move made by main rival Virgin Australia, which has an unlisted international entity that is majority-owned to comply with the Air Navigation Act, while its local operation is primarily owned by Air New Zealand, Singapore Airlines and Etihad Airways.

Deutsche Bank analyst Cameron McDonald said a split would have many challenges, but would likely be a net positive for the airline.

''That would take some work but we don't think it would be impossible to achieve,'' Deutsche Bank analyst Cameron McDonald told Fairfax. ''I do think that [Qantas] obviously are keen to have a seat at [the global airline consolidation] table if and when it becomes appropriate.''