Officials insist Qantas control remain in Australia

A Qantas-British Airways merger wouldn’t be approved by Australian officials unless control of the “Flying Kangaroo” remained in Australia, a spokesman said on Wednesday, as shares in Qantas rose significantly on the potential of a deal that would see the carrier emerging with the strength to better compete with regional rivals such as Singapore Airlines.

The Australian government and airline union officials greeted talks between BA and Qantas with guarded enthusiasm.

Representatives from both airlines said on Tuesday that they were exploring the possibility of a merger “via a dual-listed company structure,” allowing both airlines to retain their names and branding.

“We haven’t had a formal proposal put to us, so all I can do is indicate the government’s very strong view that the Flying Kangaroo remain majority Australian owned and based,” noted Wayne Swan, treasurer of Qantas.

Other officials are saying that a merger could help ensure that Qantas retains a competitive advantage, but that any agreement would have to be in the Australian national interest. Australian Transport Minister Anthony Albanese commented that a merger would most likely need the approval of the country’s Foreign Investment Review Board.

Neither British Airways nor Qantas, who are already partners in the oneworld global airline alliance, have provided details on what a structure of the deal might look like. Both have indicated that there is “no guarantee that any transaction will be forthcoming.”

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