Qantas to sell catering business to Emirates subsidary

Image Source: Business Insider Australia

Qantas is selling it’s catering arm, Q Catering, to Emirates subsiduary dnata for an undisclosed sum. The deal requires approval from the Australian Competition and Consumer Commission before it is finalised.

dnata already services catering for Qantas in Adelaide, Canberra, London and Johannesburg and has 11 catering facilities in Australia and operates in 13 countries. Under the deal dnata will take over Q Catering facilities in Sydney, Melbourne, Brisbane and Perth and provide Qantas with food and drinks for 10 years. Qantas will still set it’s own menus and will work with produce suppliers. dnata will also get Snap Fresh under the deal. Snap Fresh is a Queensland based company that produces drozen meals for several airlines and customers in healthcare and general retail.

All 1200 Q Catering staff would become employees of dnata.

The sale is the latest in a line of non-airline asset sales over several years. Other sales have included other catering facilities, it’s 50% stake in courier company StarTrack, Qantas Defence Services and the Terminal 3 lease at Sydney Airport.

Full Qantas press release:

Qantas today announced it has signed an agreement for the sale of its catering businesses to dnata, an aviation services company that is part of the Emirates Group.

The transaction is subject to approval from the Australian Competition and Consumer Commission (ACCC). Approximately 1,200 employees of Qantas’ catering businesses will become part of the dnata operation following completion of the sale.

Qantas’ catering businesses include wholly-owned subsidiaries Q Catering Limited and Snap Fresh Pty Limited (together, “Qantas Catering Group”). Q Catering has centres in four Australian ports – Sydney, Melbourne, Brisbane and Perth. Snap Fresh is a state-of-the-art meal production plant in Queensland, specialising in Australian-made frozen meals for a number of airlines as well as customers in the healthcare and food retail industries.

Qantas Domestic CEO, Andrew David, said the sale would enable Qantas to partner with a global leader in inflight catering and prioritise investing in the airline.

“We’ve always said that we would explore the sale of certain assets where it makes sense, just as we’ve done before, including with the sale of our catering facility in Cairns and Qantas Defence Services,” said Mr David.

“The catering businesses will benefit significantly from dnata’s global footprint, catering expertise, and ability to drive investment and growth for what is a core focus of its operation.”

The sale will see the Qantas Catering Group form part of dnata’s Australian operations.

dnata’s Divisional Senior Vice President of catering, Robin Padgett said: “This agreement reflects our confidence in Australia as a market and the ongoing growth potential into the future.”

“By combining dnata’s network strength and international talent with Qantas’ domestic catering expertise, this will allow us to further grow our presence and deliver catering excellence to more customers across Australia than ever before. This includes investing in more infrastructure, starting with a new catering facility in Sydney.”

“We look forward to the opportunity to welcome the employees from Qantas’ inflight catering businesses to the dnata team.”

Under the agreement, dnata will supply catering for Qantas flights for an initial period of ten years, and Qantas will continue to work with key suppliers in menu design and development.

“Customers will continue to enjoy Qantas’ premium service, including unique Rockpool-designed menus for First and Business passengers, showcasing the best of Australian produce for millions of travellers each year,” Mr David added.

“Together with dnata, we’ll continue to deliver the inflight food and beverage experience we know our customers value, just as we work with catering companies in offshore ports for our international flights.”

dnata currently supplies catering for Qantas Group flights in Adelaide, Canberra, London and Johannesburg.

The value of the sale is commercial-in-confidence.

About dnata

dnata, a part of the Emirates Group, provides catering, cargo and ground handling services from 129 airports. Including its business and consumer travel businesses, it operates in 84 countries, employs more than 4000 people in Australia and more than 39,000 globally.

dnata Catering operates 11 catering facilities in Australia. Globally dnata’s catering operation spans 63 locations across 13 countries, providing flight catering and inflight retail services to more than 190 airlines.

dnata’s Australia catering business is headquartered in Broadbeach, Queensland, with a local CEO and senior management team.

Over the past 12 months dnata has invested significantly in growing its global catering network. Its most recent milestones include the opening of a catering facility in Dublin, Ireland, the opening of its $50m Melbourne catering facility and an agreement to acquire New York-based caterer 121 inflight catering. It is also currently constructing a facility in Vancouver, Canada.

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