20 cashed-up buyers are now circling Virgin Australia

The looming sale of Virgin Australia will be “a very competitive process” involving “high-quality bidders with fantastic credentials and the ability to restructure this business.”

That’s the upbeat take of airline administrator Vaughan Strawbridge from Deloitte, according to attendees at this morning’s first meeting of creditors – a meeting held online rather than in person due to restrictions in place to stem the spread of COVID-19.

“A large number of parties have expressed an interest” in buying Virgin Australia, Deloitte had confirmed. “Eight have signed non-disclosure agreements, and negotiations are continuing with a further 12.”

“Our objective is to restructure and refinance the business so it emerges stronger on the other side of the COVID-19 crisis,” Strawbridge said. “It’s still early days, yet I’ve been encouraged by the level of sophisticated party interest in the sale of Virgin Australia.”

“We remain strongly focused on restructuring and refinancing the business, creating a viable operation that will appeal to prospective new owners, and bringing Virgin out of external administration as soon as possible in an outcome that will retain jobs and the airline’s contribution to Australia and its economy.”

Strawbridge confirmed that the first round of “non-binding indicative offers” for Virgin Australia are due by May 15, 2020.

“Binding offers will then be required in June. We remain confident that our target of achieving a sale by the end of June is achievable.”

Deloitte has drawn up a proposed ‘committee of inspection’ including Australia’s major airports, Boeing, pilot and flight attendant associations, union groups, Velocity Rewards and at an aircraft leasing firm, to represent the 10,200 creditors owed an estimated $6.9 billion.

Taking selected questions from creditors, Strawbridge reiterated the “security” of Velocity points – in a nod perhaps to the revelation that the airline’s own frequent flyer program extended a $150 million loan to Virgin in 2014 which remains unpaid, and now sees Velocity Rewards standing as a creditor.

Culled from Executivetraveller.com

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