Qantas Airways Limited · ASX:QAN
Qantas Airways — Merger or Acquisition (December 2006)
17 slides from Qantas Airways's merger presentation, Dec 14, 2006
Slide 1: Allco Finance Group ASX release: Airline Partners Australia Presentation
AALLCO’ FINANCE GROUP 14 December 2006 The Manager Australian Stock Exchange Limited 20 Bridge Street SYDNEY NSW 2000 Allco Finance Group Ltd (ASX Code: AFG) Please refer to the attached Airline Partners Australia Presentation. Alice Finance be fennary Tom Lennox Company Secretary Allco Finance Grou
Slide 2: Recommended offer, 4 December 2006
RECOMMENDED 4 Decem ber 2006
Slide 3: Highlights
HIGHLIGHTS Airline Partners Australia (‘APA') today announced a recommended cash takeover offer for all of the shares in Qantas Airways Limited » $5.60 per share in cash — final price! » Unanimously recommended by Qantas Board in the absence of a superior offer and subject to the conclusion of an in
Slide 4: Attractive Price
_ATTRACTIVE PRICE _ Qantas share price v offer price (last 3 years) Red Share price v Offer Price (last 3 years) $6.00 Offer Price $5.66 $5.50 $5.00 g g 80% | Premium WAP. (to Speculation Date)!") $3.50 $4.00 Closing Price ($} $3.50 $3.00 $2.50 $2.00 T T T T T T T T T T T T Nov-03 Feb-04 May-04 Aug-
Slide 5: Responsibility of owning Australia's national flag carrier
Airline Partners Australia acknowledges the responsibility of owning Australia’s national ‘flag carrier’ » Majority Australian owned and controlled » Same Australian management & growth strategy » More than 2/3 of the Board will be Australian citizens >» Compliance with all ownership laws and regula
Slide 6: Making Qantas Stronger: Investment for Growth
MAKING QANTAS STRONGER a _INVESTMENT FOR GROWTH » $10+ billion capital investment program over the next five years to strengthen the Qantas product offering ~ Upgrade ageing fleet — Improve quality of Qantas’ current premium offering » Acquisition of more than 70 aircraft, resulting in a 40% increas
Slide 7: Business as Usual
_BUSINESS AS USUAL ___ Support for current Australian management and their growth strategy >» — No intention to break up the airline » No intention to cut regional services — regional network is viewed as a key asset » No intention to move maintenance operations offshore
Slide 8: Continuity of Service
CONTINUITY OF SERVICE —__ Commitment to management’s existing plans for Qantas and Jetstar >» Qantas will remain Australia’s national carrier >» Qantas will continue to employ and train thousands of Australians >» Qantas will continue its coverage of regional destinations >» Qantas’ world leading ma
Slide 9: Support management in the execution of its existing strategy
>» Support management in the execution of its existing strategy >» Patient Capital - longer term perspective than the day to day equity market » Grow the domestic flying business >» Grow internationally, driven by Jetstar » Substantial investments in new generation aircraft (A-380s, B-787s) >» Inves
Slide 10: Yee
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Slide 11: Majority Australian Owned
_ MAJORITY AUSTRALIAN OWNED _ Domestic (>60%) Foreign (<40%) watt, wow, | Texas Pacific | |) Sour
Slide 12: Committed, Experienced
COMMITTED, EXPERIENCED » Alico Finance Group is a fully integrated global financial services business, » listed on the Australian Stock Exchange and specialising in structured oN A L asset finance, specialised funds management and debt funding PAICE GROUP » Alico has established a global presence in
Slide 13: Mie TO
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Slide 14: Premium Price
- PREMIUM PRICE Compelling offer that maximises value for Qantas Shareholders Offer price premium" $6.00 $5.50 . ; ~ $5.00 / : 50% | 64% 85% 37% $4.50 | Presnium Premium Premium Premium $ per Qantas Share @ £ 2 S $3.50 $3.00 $2.50 $2.00 Offer Price 3 month wap” 6 month vwap 12 month vwar”) Average B
Slide 15: Peer valuation: Adj EV/EBITDAR and PE FY08
Adj EV/EBITDAR FY08 { 8.0x Average Adj EV/EBITDAR FY08 = 5.8x 6.0x 4.0% 2.0% 0.0% Cathay Pacific British Aways Singapore Airines ACE (Air Canada) PE FYOS 20.0% 7 15.0 Average PE FYO8 = 13.0% 10,0x 5.0x 4 0.0% Qantas 1-mth VWAP Qantas @ offer price 141K 10.4x ACE (Air Canada) Cathay Pacific Singapore
Slide 16: Airline Partners Australia
BIRLINE | PARTHERS
Slide 17: Offer Details
_OFFERDETAILS —__ » $5.60 all cash per share is the final offer price in the absence of an alternative proposal from a third party » Under the terms of the offer, the interim dividend that would otherwise be payable by Qantas in April 2007 will not be available. However, the Qantas Board is evaluati
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