The Sydney Morning Herald today said the move was seen as a way for this country's national carrier to cement its relationship with Australia's second-largest airline.
Aviation industry sources said Air New Zealand wanted to buy up to 15% of Virgin Blue, after the airlines appeared to have won indicative support from regulators for a proposed joint venture on services between New Zealand and Australia, the SMH reported.
A strategic stake was seen as giving Air New Zealand a foot in the door for the next wave of consolidation in the aviation industry, which was emerging from one of its worst downturns. Virgin Blue and Qantas were often seen as likely candidates in the longer term for tie-ups with airlines in the burgeoning Asian market.
Air New Zealand said last night that it was not a shareholder in Virgin Blue and would require Australian Competition and Consumer Commission and Foreign Investment Review Board approval to take a 15 percent shareholding. It dismissed suggestions that it would act as early as today to take a stake.
