Court Rejects Planned Airline Alliance

WELLINGTON, New Zealand (AP) _ Citing anticompetitive concerns, New Zealand's High Court rejected on Monday a proposed alliance between the country's flagship carrier and Australian rival Qantas.

Monday, September 20th 2004, 9:52 am

By: News On 6

WELLINGTON, New Zealand (AP) _ Citing anticompetitive concerns, New Zealand's High Court rejected on Monday a proposed alliance between the country's flagship carrier and Australian rival Qantas.

Despite the option to appeal, Qantas said the decision all but killed the proposal and that it was time to move on.

The High Court upheld a New Zealand Commerce Commission's decision rejecting the proposed merger on the grounds it was anticompetitive, the airline said in a statement to the country's stock exchange.

Air New Zealand chief executive Ralph Norris said in a statement he was disappointed with the decision.

Under the proposed alliance, Qantas was to buy up to 22.5 percent of Air New Zealand for 550 million New Zealand dollars ($363 million), enabling the two operators to cooperate on all their routes between Australia and New Zealand.

Both Air New Zealand and Qantas said the alliance was necessary to help them cope with increasing competition within the aviation industry. Air New Zealand, which is 82-percent government owned, had said the deal was critical to its long term survival.