National interest to be a key consideration in Virgin-Qatar decision: Chalmers
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More news: Federal Treasurer Jim Chalmers and Finance Minister Katy Gallagher have said national interest and strengthening competition in the aviation sector will be key considerations in granting approval to Qatar Airways proposal to take a 25% stake in Virgin Australia.
What they said: "We know across the economy, not just in the airline sector, that foreign investment can be in our national interest. And my job, and the Foreign Investment Review Board's [FIRB's] job, is to determine the national interest and make decisions consistent with it," Chalmers said.
Speaking on Sky News, Gallagher said: "Obviously we need to have both Virgin and Qantas continue to perform strongly. I mean, we’re looking to increase and look at how we can support further competition in the airline industry".
Opposition leader Peter Dutton also welcomed the announcement of the deal: "That's a question for FIRB, but we welcome competition and Virgin is stronger as a result of this investment. And it's good for consumers in our country if there's competition, which is obviously not the case necessarily at the moment".
Qatar Airways to buy 25% stake in Virgin Australia
The news: Qatar Airways will acquire a 25% stake in the country’s second biggest airline Virgin Australia from its private equity owner Bain Capital.
The numbers: The parties did not disclose any financial details of the deal, but said it would require approval from the Australian Competition and Consumer Commission and the Foreign Investment Review Board.
The context: The deal will expand the existing codeshare partnership between the two airlines. It is also expected to allow a measured entry by Virgin Australia into long-haul international flying through access to widebody aircraft.
The expanded codeshare and collaboration arrangement will also provide access to a greater range of international destinations with improved schedules and frequencies, increased earn and redemption opportunities for members of Velocity and Qatar Airways’ Privilege Club, and broader access to value fares for travellers.
What they said: "Qatar Airways Group’s strategic investment will provide access to the critical scale and expertise of a world leading global airline," the two airlines said in a statement.
"The minority stake also serves as a cornerstone investment ahead of an anticipated return of Virgin Australia into public ownership and the opportunity that would provide for Australians to share in Virgin Australia’s future."
The source: Virgin Australia
