News Corp bids adieu

to Ansett Australia

RUPERT Murdoch’s News Corp Ltd’s decision to sell its 50 per cent stake in Ansett Australia has not come a moment too soon or the recovering airline.

Ansett has struggled to compete against the might of Australia’s dominant airline Qantas Airways Ltd and now looks set to thrive under the wing of its new cashed up shareholder Singapore Airlines, according to analysts.

Under the ownership of a media company and Air New Zealand, with 50 per cent each, Ansett struggled to make profits, only recent ly reporting a turnaround in its fortunes to post first half net earn

ings of $61.6 million.

Still a lar cry trom Qantas' stunning $222.9 million half year net profit, it was an improvement on Ansctt's $18.6 million operating loss in 1995/96 and an indication of just how far the airline has come.

News Corp and TNT took equal stakes in the airline in 1979, with Murdoch and Sir Peter Abelcs becoming joint managing direc

tors. Founder Sir Reginald Ansett remained as chair until his death two years later.

However, over the next decade Australia’s first airline lost its way and became seriously threatened as it failed to secure the back ing of other airlines.

In 1996, the Australian government gave Air New Zealand approval to buy TNT’s 50 per cent holding of Ansett Holdings, pro viding that 51 per cent of Ansett International remain Australian owned.

Then in 1997 former Cathay Pacific boss Rod Eddington was given the brief by Murdoch to turn around the loss-making airline within a few years, ensuring a healthy exit for News Corp.

Murdoch had never hidden his plan to dispose of the non-core asset but remained unwilling to invest the dollars needed to boost its fortunes.

Executive chair Eddington took to the task, launching a business recovery programme with the aim of delivering annual profits equivalent to ten per cent of the airline’s annual turnover.

Now with the airline gaining momentum and with another airline as a half shareholder to provide some backbone, Ansett may stamp itself as a more dominant player in aviation. ■