Today Virgin Airlines (VAH.ASX) sent out media releases for its plan entering back into the airline market in Australia, even though part of the country is still in lockdown. Maybe Gold is a better punt right now, but thats anybody’s guess!
While the VAH shares are currently still suspended, it will be back in the market hopefully post the full re-balancing with its new owner’s Bain capital.
It prepares to exit voluntary administration under the ownership of Bain Capital hopefully by the end of the month this August.
Here is the latest Virgin Airline update and keypoints
- The focus will be on delivering great value with Virgin Australia’s core domestic and short-haul international business sectors
- Virgin Australia to provide customers with the value of travel credits (10-million-member strong Velocity Frequent Flyer program) post administration
- Reduction in cost base due to current covid climate to result in job lost (3,000 jobs)
- Further cost cutting with removing ATR, Boeing 777, Airbus A330 and Tigerair Airbus A320 aircraft types
- Tigerair Australia brand discontinued
- Airline to focus on regional and charter flying for now
- To reduce costs- supplier contract review across its operations will be taken including products, services and facilities to better align with the company’s future size and requirements and lowering costs significantly
Virgin Australia aims to be the best value carrier in the market, not a low-cost carrier. It will offer exceptional experiences at great value, regardless of purpose of travel.
Virgin Australia Group CEO and Managing Director Paul Scurrah said together with Bain Capital, the plan will help to re-establish Virgin Australia as an iconic Australian airline, bringing strong competition for travellers.
The media release states “The Group will emerge from Voluntary Administration with a strong balance sheet, worthy of an investment grade rating, providing resilience and future growth potential.”
Administrators were appointed on 20 April 2020. They have entered into a binding sale agreement for the business with Bain Capital and continue to work with Bain Capital and Virgin Australia management on the restructuring of the airline.
The preferred method of implementation of the sale is through a Deed of Company Arrangement (DOCA) to be proposed by Bain Capital, which will be put to a vote at the second creditors’ meeting soon.
Bookmark this page as i intend to update this article as the restructuring of VAH continues…