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Indignant Virgin Australia invokes lawyers over Qantas

November 22, 2013 Aviation, Headline News No Comments Email Email

egtmedia59At its annual general meeting in Brisbane on Wednesday, Virgin Australia said it was instructing its lawyers to consider the allegations made against it by Qantas Group chief executive Alan Joyce concerning its capital raising program involving its three major airline shareholders: Air New Zealand, Etihad and Singapore Airlines.

Chairman Neil Chatfield announced the legal brief before the company’s chief executive and former senior Qantas executive John Borghetti, took the podium at the AGM, aviation reporter Ben Sandilands reported in his Plane Talking travel blog on crikey.com.au.

Chatfield was reported to have said: “let me assure you that we have instructed legal advisors to act for us in dealing with this matter”, though Borghetti would not be drawn on the topic later.EGT_Artical Banner B 250x250

Virgin Australia says the claims made in an emotive letter to government and email to staff by Joyce are false. It regards them, and their possible consequences, seriously.

In his address, Borghetti said:

“To say that Virgin is driven by a strategy of uncompetitively low prices and irrational behaviour is offensive and absurd.

“The airline is run rationally with good management and a view to creating a long term sustainable and profitable business. It is our superior cost position that enables us to bring low fares to the market. In fact, we are continuing to position Virgin Australia to grow and compete even more effectively in the Australian market for the benefit of our shareholders, our customers and all of our stakeholders. We have embraced change and competition and adapted our business to it.

“When you bring competition to a monopoly, prices do go down, if this is affecting out competitor’s bottom line, I am not going to apologise. Australian travellers and the Australian economy are benefiting, and ultimately shareholders will too.”

Virgin Australia Holdings Ltd says there will be no change in control as a result of the AUD 350 million capital raising announced last week, the Business Spectator reported.

Chatfield told shareholders that Virgin Australia’s international business is and will continue to be majority Australian owned and run by an independent Australian board with its own assets and balance sheet.

“It fully complies with the requirements of the Air Navigation Act, he declared.

Written by : Peter Needham

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