News: AQZ Australia's ACCC Comments On Qantas-Alliance Aviation Deal, page-48

If the ACCC declines to give Qantas clearance tomorrow, IMO there is a real chance that Qantas will seek to challenge the position through the courts, therefore meaning that the current state of limbo could drag on for many months yet. The SID keeps AQZ committed until December 2023 (or later if proceedings are still active) if the acquisition is still conditional on competition clearance. The upside of a further delay is that if the scheme is implemented that the scheme consideration if effectively increased by a dividend (with franking credits?) of 3 cents per share for every month or part month delay from 5 November 2022.

We haven’t seen any divestment undertakings having been made public in the lead up to tomorrow’s scheduled announcement, suggesting that there are no active negotiations with the ACCC on what’s required to happen to get the deal over the line. Maybe this indicates a no decision is coming on the basis that there are no around the fringes divestments that would change the ACCC’s mind.

The latest one month delay following AQZ’s decision to buy another 30 E190’s is interesting because it’s hard to see how this would lessen any competition concerns, rather it makes AQZ a larger future competitor to QAN in the FIFO market. Or does it mean that a greater proportion of AQZ’s business is to supply wet lease aircraft to QAN and therefore the overall impact of the competition reduction relative to the size of AQZ is somehow relevant to the ACCC’s decision?