The federal opposition seems to have finally found the tooth to worry about the Qantas takeover — frequent flyer points — and Qantas only has itself to blame.

Qantas management has been carefully saying nothing has changed, but with so many flyers still ruing the loss of their Ansett points, customers are only too well aware that the Flying Roo effectively downgraded their points last year. And if the “old” Qantas was prepared to trim FF members entitlements, what might the heavily-geared “new” Qantas attempt? Once bitten…

Meanwhile pilots and more humble unionists are fulminating without being able to find a hard target to attack. And the reality remains that the private equiteers will only accelerate what was pretty much Geoff Dixon’s existing strategy for reducing costs.

But the best story on the Qantas deal belongs to Alan Kohler on Friday with the details pretty much repeated in the AFR’s weekend Chanticleer. And that’s the yarn about how the Allco management team will collect many millions in fees for doing the deal whatever the subsequent Qantas performance.

With fees like this on offer for the financial engineers, the deals will get done with or without benefit to other investors. And when remembering what a dog stock Allco Equity Partners has been since listing a couple of years ago, the extent of the gouge becomes even more outrageous.

Peter Fray

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