[Scythian]

A merged airline group could lead to billions of dollars of extra benefits that neither of them could achieve by flying solo,’ O’Sullivan details.

‘Under the plans, the airlines would form a fifty-fifty joint venture and merge their networks’, although each airline’s highly-recognisable brand would remain.

Behind-the-scenes lobbying ensured that both the Australian and Singaporean governments expressed tacit support for the merger.

But Qantas’ prior success in convincing the Australian government to block Singapore Airlines from flying between Australia and the USA, and its reluctance to shutter the recently-launched and Singapore-based budget airline Jetstar Asia, made bitter tea for the Singapore Airlines executives.

[Scythian]

A marriage of unequals?
As O’Sullivan recounts, more turbulence lay ahead.

The market capitalisation of Singapore Airlines was larger than Qantas. ‘The Singaporeans felt, quite rightly, that they were getting the rough end of the deal from Qantas, which was pushing for a merger of equals – a fifty-fifty split.’

‘The structure of a merged airline also led to the important question of who would become chairman and chief executive.’

Qantas chief Geoff Dixon wanted to remain CEO of the merged airline, but to allay concerns of Australians and Singaporeans alike – who felt a deep sense of nationalistic pride and almost ownership of their respective flag-carriers – ‘the executives toyed with the idea of a dual board, each of which would have its own chairman.