Qantas has reached an agreement to fully acquire Australian-based operator, Alliance Aviation Services Ltd, in a move it says will enable the national carrier to better serve the growing resources sector.
The agreement, which is subject to a vote from Alliance shareholders and competition clearance, would see Alliance become a wholly-owned part of the Qantas Group.
There is no change to Qantas’ arrangements with Alliance as a result of today’s announcement given the approvals required, which would take a minimum of several months to secure.
Alliance has a fleet of 70 jet aircraft that seat up to 100 people each, making them well suited to charter operations.
Between these charter services and a small number of passenger routes that overlap with large mine sites, Alliance accounts for around 2 per cent of the total domestic market.
The national carrier is Alliance’s biggest single customer, with a long-term agreement that sees Alliance operate up to 18 newly acquired E190 jets for QantasLink.
This arrangement has helped open new direct routes and increase frequency across regional Australia.
Qantas bought just under 20 per cent of Alliance in February 2019 and at the time flagged its long-term interest in acquiring 100 per cent of the airline.
Qantas Group CEO Alan Joyce said acquiring the remaining shares in Alliance would mean QantasLink can better compete in the highly competitive charter segment, particularly given the shared fleet type of Fokker aircraft.
“We’ve opened up several new passenger routes using up to 18 of Alliance’s E190s, so bringing all 33 of these aircraft, plus their crews, into the Qantas Group would really expand what we could achieve,” Mr Joyce said.
“We plan to extend our program of guaranteed lower fares for residents in those few communities where Alliance operates its own passenger services, as well as access to our Frequent Flyer program.”
Qantas says will continue to update the market on expected completion timing as the competition clearance and Alliance shareholder vote processes progress.
For more information head to qantas.com.au