Yesterday afternoon Singapore's international TV station Channel News Asia (CNA) interviewed me to get some analysis on Jetstar Asia's ownership change.
This change involves the Singapore Government's investment arm Temasek Holdings selling its 33.5% stake in Singapore-based Jetstar Asia and the smaller shareholders are also selling out.
It also means Qantas Airways is increasing its stake in Jetstar Asia to 49% from 45% and Singaporean businessman Dennis Choo is stepping in and buying a 51% stake.
CNA had already interviewed Jetstar's CEO, Bruce Buchanan, yesterday and he would have obviously highlighted the positive aspects of the change.
So the CNA reporter asked me in the afternoon what could be the possible negative consequences of no longer having Temasek as a shareholder.
Quite frankly, I don't see a downside. Not having Temasek involved in Jetstar Asia, in my opinion, makes the decision-making process at Jetstar Asia a lot simpler and means the business can be run more efficiently.
Besides CNA, I was also interviewed by Singapore's Today newspaper. Once again the journalist looked to see if there were any negative consequences. "The fact that Temasek is selling out. Isn't that a slap in the face for the airline industry?," asked the journalist. He also asked if Temasek's exit from the business is a sign that airlines are no longer a good investment?
My response was that Temasek is probably selling out because it wants to focus its attention and energy on its larger investments. In the world of Temasek, Jetstar Asia is a tiny investment so the time and energy of Temasek's top management are probably better spent on Temasek's larger investments such as its investments in US financials and Asian tech stocks.
I also had chance yesterday to speak to Buchanan at Jetstar who made the point that when Temasek bought into Jetstar Asia a few years ago, it was at a time when Singapore was keen to have low cost carriers set up in Singapore.
They could see what was happening in Malaysia, he said, referring to Malaysian low-cost carrier AirAsia which has become a formidable competitor.
In my opinion, now that Jetstar Asia is firmly ensconced in Singapore and is unlikely to move, there is now no need for Temasek to continue owning shares in the airline. If buying into Jetstar Asia was a strategic move to get Jetstar to establish a base in Singapore, then that goal has now been achieved. So probably better for Temasek to move on and look at other investment opportunities.
Its also interesting to note that Jetstar Asia's new 51% owner Dennis Choo already has a strong relationship with Qantas.
Buchanan told me that Choo has been doing business with Qantas for about 20 years and is already Qantas and Jetstar's general sales agent in many Asian countries such as Singapore, Thailand, Indonesia, China and India.
Having Singaporean businessman Choo as a business partner is a good move. Qantas needs to have a Singaporean own 51% of Jetstar Asia in order to meet Singapore's foreign ownership laws.
But in Choo, they have a businessman they know and whose travel business is so closely tied to the success of Qantas and Jetstar.