Qantas Airways Limited

The proposed takeover of Australia’s national airline is looking more and more like ‘amateur hour’. It’s not what you’d expect from a venture including Macquarie Bank, but it looks pretty embarrassing for all involved.
The offer was due to close at 7pm last Friday, and it would have been automatically extended if acceptances passed 50%. Until that time, the offerors, Australian Airline Partners, had struggled to get owners across the line. One reason for this is that hedge funds had bought a large proportion of shares and were playing games. Each was holding out hoping that another would accept. The stand-off backfired when one group failed to accept in time.
An attempt to approve acceptances received after the offer was closed has been rejected by the Takeovers Panel. This decision has been appealed so the bid might yet proceed. It’s also possible that APA could make a new bid at the same price.
The stock is currently in a trading halt pending an announcement by the company, but the price would have to fall a very long way for us to be remotely interested in the company as an investment. We recommended selling on 19 Feb (Sell – $5.20) and that remains our view. SELL.
Disclosure: Staff members own shares in Macquarie Bank, but they don't include the author, Tim Searles.