flight-centre-deal-grounded-again

Flight Centre deal grounded again

The Australian travel operator fails in its second attempt to strike a deal with Pacific Equity Partners following a global squeeze on leveraged finance.
Australian travel operator Flight Centre has failed in its latest attempt to change its ownership structure with the help of private equity. Yesterday, the companyÆs directors announced that they were abandoning a proposed joint venture with Pacific Equity Partners PEP because the cost of the transaction and the tax considerations were too high.

The company also said that an independent expertÆs report concluded that PEP had undervalued the business and that the transaction was ôneither fair nor reasonableö.

However, equity analysts say the details surrounding the termination of the proposed joint venture are vague and that the results of the expertÆs report are a red herring. They reckon that the recent volatility in the global...
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