As multiple bidders for Virgin Australia put the finishing touches on their initial offers for Australia’s failed second airline, its administrator has committed to the sale of the carrier as a whole business.
Deloitte’s Vaughan Strawbridge, who is leading the voluntary administration of the Paul Scurrah-led airline, has told Virgin creditors that he wants to “avoid breaking up and selling parts of the business”.
“The best outcome for everyone is the preservation of the whole business,” Strawbridge is revealed to have told creditors at their first meeting on April 30, the minutes for which have just been released.
Strawbridge, who was appointed after the airline collapsed on April 20, told creditors there was no plan for any redundancies in Virgin’s 9000-plus workforce and said he was positioning “the business for relaunch and sale”.
Almost 20 organisations have lodged expressions of interest in the Virgin sale process, with non-binding indicative bids due this Friday.
The Australia’s DataRoom column reported on Tuesday that Indian billionaire Rahul Bhatia is understood to have hired advisory firm Investec to compete for Virgin Australia ahead of expressions of interest due on Friday.
A management plan for the reinvention of the Richard Branson-founded airline is believed to have on Monday been added to Deloitte’s virtual data room set up for the sale process.
Clayton Utz is acting as legal advisor to the administrators, while Deloitte has also engaged Morgan Stanley and Houlihan Lokey as financial advisers. All three professional services firms were working for the airline before it failed.
US law firm Akin Gump has also been engaged by Deloitte to help with bondholder relations. Virgin bond holders are unsecured and rank alongside other creditors. Coupon payment to the bondholders have been halted.
Accounting firm PwC is acting for Virgin’s Velocity Rewards, a separate legal entity which is not one of the 38 companies plunged into administration in April.
The meeting’s minutes reveal a host of local and international banks attended the first creditors’ meeting, including local institutions Westpac, Commonwealth Bank and ANZ, along with Macquarie and international counterparts including Bank of New York Mellon, BNP Paribas, Deutsche Bank and Bank of China.
Meanwhile, Strawbridge revealed he wants the process to move fast and that he’s preparing for some turbulence ahead, telling creditors he “appreciated that the administration process may become political … and come with a high degree of media interest and scrutiny”.
Buckle in for the ride.
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