Bold new plan lodged in sale of Virgin Australia
The imminent sale of Virgin Australia appears to have been delayed after administrators received a bold new plan to recapitalise the airline and send it back to the ASX.
QLD Business
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VIRGIN Australia bondholders have fired a last-minute proposal to Deloitte to stop the sale of the embattled airline and instead recapitalise the company on the stock market.
It is understood the Deloitte Administrator Vaughan Strawbridge received the proposal from the bondholders, which have invested about $2 billion in the airline, on Wednesday.
Two bidders, Bain Capital and Cyrus Capital, had been short-listed to purchase the airline – with Mr Strawbridge tipped to decide within days.
Bondholders, however, are attempting to stop the sale, arguing the state of the economy makes it the wrong time to sell the airline.
The bondholders have proposed converting into shareholders, providing Virgin Australia with the chance to be relisted on the ASX with a $1.4 billion market capitalisation.
The proposition is likely to add complexity to the sale process.
It is understood Mr Strawbridge, who is close to announcing a winner, is considering the bondholders’ proposal.
Bain Capital and Cyrus Capital have pledged to keep the airline in Brisbane thanks to a $200 million injection from the Queensland Government, through Queensland Investment Corporation.
The make-up of the injection, including whether the state will take an equity stake in the airline, is not yet known.