VIRGIN Australia is preparing to make some significant changes to its growth strategy, if sources close to the airline can be believed.
An article this week that appeared in The Australian suggests the carrier is currently examining the prospect of joining forces with another major player in the region, with Air New Zealand and Rex Airlines both touted as possible partners.
The report quoted sources familiar with investment banks who are believed to be in the process of delivering advice on a potential merger with Air New Zealand, which if were to go ahead, would likely involve a back door dual listing in Australia and New Zealand.
If true, somebody may have f0rgoten to inform Air New Zealand about the plan, with the carrier taking to the ASX to deny the media report.
“Air NZ confirms that it has not been approached and is not in discussions with any parties regarding a potential merger,” the airline’s Chair Therese Walsh said.
Whether the Kiwi airline is being coy or genuinely has no knowledge of the rumour remains to be seen, but if true would be a call back to a former relationship between the pair, with Air NZ previously owning a fifth of VA as part of an alliance before selling its stake to the Chinese-backed Nanshan Group for $260 million in 2016.
Meanwhile, the same sources also suggest VA is examining the prospect of purchasing Rex Airlines, but intriguingly only under the condition that Rex revert back to being a strictly regional player and exit the east coast Golden Triangle.
VA’s CEO Jayne Hrdlicka was asked at a CAPA summit in Adelaide recently whether the airline would contemplate ramping up its focus on servicing regional routes and recommence flying turboprop planes, with the carrier’s chief playing her cards close to the chest.
“Regional Australia is incredibly important to us and we appreciate the importance of getting people to move across our huge country,” she said.
“We will always continue to look at ways [to improve services], but going back to the simple rule, which is working hard to maintain a focus on simplicity…we do not want to add complexity with different fleet types, but we will always work creatively to ensure that there’s great connectivity in regional areas,” Hrdlicka added.
Late today Rex Airlines responded to the rumours, issuing a statement saying it “does not comment on market speculation”.
“It is up to Virgin Australia to comment on this matter,” the carrier said.
