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Australian Government Approves Sale of Qantas

Australia's government has cleared the way for the sale to an international group of the country's flag carrier, Qantas Airways, while Hong Kong's Cathay Pacific Airways has posted a better-than-expected rise in annual net profits. Claudia Blume has more on these and other Asian business stories from VOA's Asia News Center in Hong Kong.

The Australian government has approved an $8.8 billion takeover bid for Qantas Airways. The bid was made by Airline Partners Australia, a private consortium that includes Australia's Macquarie Bank, the U.S. private equity firm Texas Pacific Group, and Canadian investor Onex.

The North American representation in the consortium has made the sale of the national flag carrier politically sensitive. Treasurer Peter Costello says the government approved the takeover only after the group agreed to a range of conditions.

"Foreign majority ownership of Qantas will not occur. Foreign control of Qantas will not occur," Costello says. "A majority of directors of Qantas must be Australian citizens, and Qantas must remain based in Australia."

Qantas shareholders have yet to make a final decision on the sale.

Hong Kong's flag carrier Cathay Pacific posted a 24 percent rise in annual profit for 2006: $520 million, up from $420 million a year earlier. Record passenger numbers and growth in freight volume spurred the profit increase. Last year's merger with smaller rival Dragonair - which gave Cathay new routes into the lucrative Chinese market - also contributed.

U.S. banker Citigroup says it will launch a $10.8 billion takeover bid for Japan's third-largest brokerage firm, Nikko Cordial. If the deal goes ahead, it will be the largest acquisition of a Japanese company by a foreign firm.

Citigroup already owns a 4.9 percent stake in the Japanese brokerage, which is facing possible delisting from the Tokyo stock exchange for false accounting. Taking full control of Nikko Cordial would help the U.S. company strengthen its presence in Japan.

China will not allow any new Internet cafes to open this year. State media say the new restrictions are part of a campaign to combat the rising problem of Internet addiction and online gambling. Cyber cafes that have already received approval must be completed by the end of June. There are currently more than 100,000 Internet cafes around the country.