Qantas is laying the groundwork to split its domestic and international arms, in order to enable what CEO Alan Joyce calls "future investment around the international business."
The move involves setting up a new holding company for Qantas International, Alan Joyce explained this morning during QF's 2013-2014 full year financial results. It's also responsible for the paper loss of $2.6 billion resulting from a write-down of aircraft value within the existing international fleet.
The groundwork creates "options for us into future," Joyce said, highlighting a relaxed timescale for the actual split, but added that "those options could be mixed and varied and we’re not going to speculate how they might occur."
Recent changes to the Qantas Sale Act now allow a single foreign airline or investor to hold as much as 49% of Qantas, up from a previous 25% cap for any single overseas investor or 35% for all foreign airlines combined.
Under the new structure, overseas investors could take an equity slice of the stronger performing Qantas Domestic wing separate to Qantas International or, under the current structure, the parent Qantas Group.
Qantas already runs its domestic and international arms as two distinct business units, each with its own CEO heading up operational and commercial functions, following a restructure in May 2012.
Ironically, the split will see Qantas adopt an identical structure to challenger Virgin Australia – a structure which Qantas has previously criticised as part of its "level playing field" crusade.
The most likely stakeholder is Qantas partner Emirates, although Emirates President Tim Clark has previously poured cold water on hopes of an equity investment along the same lines as that held by competitor Etihad Airways in Virgin Australia.
Follow Australian Business Traveller on Twitter: we're @AusBT