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Air New Zealand [NZX: AIR] has increased its cornerstone shareholding in Virgin Australia to the maximum allowed under that nation's foreign investment rules.
The Auckland-based airline now owns 25.99 percent of the Australian budget carrier, from a previous 24.46 percent, it said in a statement. The company has lifted its stake 3 percent since October last year, when it sought approval from the Australian Treasurer after gaining consent from the Foreign Investment Review Board and the Australian Competition and Consumer Commission. The current level is the maximum allowed by Australia's foreign investor regulator.
Air New Zealand formed a partnership with Virgin, providing links with its flights into Australia, after the failure of its Australian-based airline Ansett in 2001. Virgin Australia's other major shareholders are Virgin Group and Singapore Airlines.
The shares in Air NZ rose 0.2 percent to $2.265, edging off last Thursday's seven-year high of $2.27, and have advanced 38 percent this year.