Air NZ refutes 'smear campaign'

By Phil Boeyen, ShareChat Business News Editor

Tuesday 25th September 2001

Allegations of asset stripping at Ansett appear to be nothing more than a smear campaign according to Air New Zealand's (NZSE: AIRVA) acting chairman, Jim Farmer.

Dr Farmer has moved to quell allegations against the airline which claim, among other things, that Air New Zealand grabbed Ansett jet engines and flew them to New Zealand just prior to putting Ansett into voluntary administration.

"We have investigated each and every allegation, and they are completely without foundation," he says.

"Why any thinking person would believe Air New Zealand would stoop to this sort of behaviour when at times during the past 12 months we have funded Ansett operating losses by as much as $A180 million is beyond my comprehension.

Dr Farmer has challenged three specific allegations against Air NZ, including that it had put A$200 million of its aviation bills through Ansett's accounts.

"The two airlines bought fuel on a competitive tender basis from oil companies at various airports, combining their purchasing power to get the best prices, but each airline had a separate account and oil companies billed the airlines separately based on aircraft registration numbers which identified the correct airline to be billed beyond doubt," he says.

Another allegation that Air New Zealand improperly cleared out Ansett bank accounts in the last few weeks before a voluntary administrator was called in has also been refuted.

Dr Farmer says the facts are that Air New Zealand funded Ansett losses from the time it obtained a 100% shareholding in the company and when Ansett went into voluntary administration on September 14 it still owed Air New Zealand more than $A80 million under funding arrangements to cover its losses.

"Furthermore, the administrator has confirmed to me that he has also been unable to find a shred of evidence of any of the alleged asset-stripping.

"For my part, I have told him that if any removal of Ansett's assets or Ansett payment of Air New Zealand's costs comes to light, Air New Zealand will naturally honour any legal obligation to make a compensating payment to Ansett".

Dr Farmer says he understands there is considerable anger about the Ansett situation in Australia but is urging an end to a smear campaign which he says has no factual basis.

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