Qantas lashes Virgin raising

Joyce urges Abbott to halt $350m foreign capital injection into rival airline.

Qantas Airways (QAN) chief executive officer Alan Joyce has written to the federal government to demand it block a $350 million foreign capital injection into Virgin Australia Holdings (VAH), The Australian Financial Review reports.

According to the newspaper, Mr Joyce wrote to Prime Minister Tony Abbott, Transport Minister Warren Truss and every state government to express his concern that the move was the "final act" of "predatory" state-owned airlines looking to undercut Qantas, weaken its domestic and international positions and eventually take over its routes. 

Mr Joyce wrote that the $350 million capital raising announced by Virgin last week was the latest development in a gradual foreign takeover of the rival airline, designed to circumvent foreign investment regulations.

The AFR reports Mr Joyce points out in the letter, the capital raising would lift the the total ownership of Virgin by a trio of state-owned airlines – Air New Zealand, Singapore Airlines and Etihad Airways – from 63% to 72%.

The national carrier's chief executive officer also urged the federal government to reconsider the Qantas Sale Act, which he labelled as an “outdated policy framework”.

Meanwhile, The Australian reports Qantas is mulling the cessation of its longstanding codeshare arrangement with South African Airways as the burden of regulatory hurdles continues to weigh.

According to the newspaper, the national carrier still has a year to run on the current deal, but has reportedly already commenced sourcing alternative arrangements so as not to disrupt customers looking to book flights a year in advance. 

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