Qantas (QF, Sydney Kingsford Smith) is set to welcome further foreign investors into its shareholding after the Australian government agreed to lift existing caps limiting foreign ownership.
According to the Sydney Morning Herald, an intense debate in the country's Senate led to government adopting an opposition-backed proposal which will increase foreign ownership caps to 49% from its current limits of 25% for individual investors and 35% for foreign airlines.
Tony Abbot's government had initially proposed to lift all restrictions on foreign investment into the struggling carrier as outlined in Section 3 of the Qantas Sales Act, in line with its management's recommendations.
Justifying their move, Australian opposition Senators said they feared the opening up of Qantas could lead to the loss of thousands of domestic jobs.
Earlier this year, the carrier announced plans for AUD2billion (USD1.98billion) in cuts to be phased in over five years following an underlying loss before tax of AUD252million for the six months ended December 31.
Qantas partially blamed Virgin Australia (VA, Brisbane International) for creating an uneven domestic playing field thanks to its shareholders which now include Air New Zealand (NZ, Auckland International), Etihad Airways (EY, Abu Dhabi International), and Singapore Airlines (SQ, Singapore Changi).
