Virgin’s future secured

Creditors confirm sale

VIRGIN Australia’s sale to US private equity firm Bain Capital has been confirmed by creditors, who voted overwhelmingly in favour of the $3.5bn deal.

The vote secures the immediate future of the nation’s second largest airline which faced liquidation if creditors had rejected the deal.

Figures from the meeting held on Friday show 6456 creditors voted in favour of the deal, 63 against while 257 abstained from voting.

The outcome was all but sealed when key unions declared their support for Bain’s deed of company arrangement prior to the meeting.

In return, Bain has promised to include three union officials on an advisory panel with senior management.

Bain’s Australian head Mike Murphy, Virgin chief Paul Scurrah and senior administrator Vaughan Strawbridge all welcomed the result, calling it an “important milestone and a significant step” in the airline’s recovery.

“We can now continue the rebuilding process from the strongest possible platform and with the least disruption,” Mr Murphy said.

Mr Scurrah said the hard work was not over yet, with the impact of COVID-19 still “very challenging” for the business.

“These are tough times and we must remain focused and adapt to this new environment,” Mr Scurrah said.

“I’m pleased today gives us some more certainty around the company’s future.”

Virgin founder Sir Richard Branson said it had been a massive effort by the administrators and management team and the focus should now be building up the airline even better than it was before.

“We are excited to create that next chapter together with Bain and the airline’s wonderful team,” he said.

Transport Workers’ Union national secretary Michael Kaine said the vote signalled a “new beginning for Virgin Australia and for Australian aviation”.

I’M PLEASED TODAY GIVES US SOME MORE CERTAINTY AROUND THE COMPANY’S FUTURE VIRGIN CHIEF PAUL SCURRAH

“I want to congratulate Virgin workers who have been instrumental in getting us to (this) point,” Mr Kaine said. “There have been long and difficult days and our thoughts are with the 3000 workers who will no longer be with the airline.”

Virgin Australia will have a workforce of up to 6000 employees and a fleet of between 30 and 60 Boeing 737s as it emerges from administration.

The airline went into administration on April 21 with debts of $6.8bn. Bain has promised to pay employees their full entitlements and to honour passenger travel credits.