Qantas, Malaysia Airlines deal falls through

Qantas and Malaysia Airlines have failed to agree to commercial terms on possible Asia-based partnerships.

The companies were aiming to create a jointly-run premium airline.

Qantas CEO Alan Joyce said in a statement to the ASX today that Asia remained a priority, with opportunities there still being explored.

“The transformation of Qantas’ international business remains vital, with plans to return the international business to profitability in the short-term on track. In the medium term, the Qantas flying businesses, both domestic and international combined, will exceed the cost of capital on a sustainable basis,” Joyce said.

Qantas said minimal capital would be allocated to Asian ventures in the short-term due to economic uncertainty and the company’s focus on disciplined financial management.

Qantas shares dropped 2.61% on the announcement, and were trading at $1.68 at 10.50am.