With APA having made it very clear that they will not increase their price for Qantas shares, the UBS and Balanced Equity Management’s rejection of the $5.60 offer price means that a stand off or collapse of the deal is very much on the cards – they also met with the Qantas Board this week to explain the background to their decision.
Also, in a statement to the Australia Stock Exchange this week, Airline Partners Australia has also stressed that the $5.60 offer is their final offer and that they will not increase it beyond that, but neither can they as the offer price cannot legally be increased without the whole the proposal process being gone through again.
UBS and Balanced Equity Management say that the offer has undervalued Qantas and although they cannot block the bid themselves, it appears that they will be securing the support of other fund managers and shareholders to secure the additional 4% to add to their 6% to stop the bid as 90% of Qantas shareholders have to agree.
The overall shakiness created by the possibility that UBS Asset Management and Balanced Equity Management could stop the sale resulted in Qantas shares dropping their lowest price since December, closing down 3c at $5.16 yesterday.
Report by The Mole
