Forum Archive Index - July 2001

["Jeremy" <jeremy@electrosilk.net>]

From: "hugh webber" <hugh.webber@clear.net.nz>

> I thought the consensus in media discussion was that the proposals
> involved abolishing the two classes of shares and just having one,
> in effect Air NZ A.
>
> > The political decision is whether to increase foreign ownership ratios
or
> > not.  How it is done is a mere technicality.  Either they open AIRVA to
> > foreigners and get no cash injection, or they issue more AIRVB and get
> more
> > cash.  What do you think they will do?

What was previously discussed was increase in foreign ownership, with
posters saying that was not possible.  I disagreed with the assumption and
then pointed out it doesn't matter how that is done.

It may well be that A/B shares are abolished.  However, that removes the
ability of the Government to control the mix.

I suggest that as NZ ownership, or at least control, is a political
necessity.  The solution may involve only one class of share but with a cap
on foeign ownership (however that is measured).  An alternative solution is
to maintain the existing model.

The differences between the two options are basically how 'free' the market
is.  With one class of share there is more flexibility for purchasers to
effect changes in control.  On the other hand it makes it more difficult for
the Government to maintain political control.

I still maintain that issuing new B shares is the ideal solution, as it
maintains Government/NZ control yet gets more cash in.  Other options don't
get cash and lessen Government control.


Jeremy



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