Virgin Australia promises staff shares in airline ahead of ASX return

The private equity-owned airline’s preparations for a return to the ASX have stepped up a gear with each employee to be offered $3000 worth of share rights.

Virgin Australia’s preparations for an initial public offering have stepped up a gear with employees being offered $3000 worth of share rights, in the event the float proceeds.

After weeks of investor meetings to lay the groundwork for a return to the ASX, new chief executive Dave Emerson has emailed the airline’s 8000 staff, to inform them of the plan.

“Our success story wouldn’t be possible without each one of you. That’s why I’m thrilled to announce that if an IPO proceeds, all eligible Virgin Australia Group employees will have the opportunity to participate in our company’s future as equity holders,” Mr Emerson said in the internal note seen by The Australian.

Mr Emerson went on to explain how the “takeoff grant of $3000 worth of share rights would work”, saying they would be received at the time of the IPO.

“These rights would convert to ordinary shares after a 24-month vesting period, provided you remain employed with the group. Once vested, the shares would be yours to keep or sell as you choose,” said Mr Emerson.

“This takeoff grant represents an opportunity for you to become a shareholder in the company you’ve helped build (and) directly benefit from Virgin Australia’s future performance.”

The Transporrt Workers Union was quick to welcome the move, which it had previously called for in a five-point claim on Virgin’s owner Bain Capital. 

TWU national secretary Michael Kaine said it was a “relief to see an aviation company treating workers as an investment rather than a cost to be ruthlessly cut”.

“Virgin workers have been hugely instrumental in returning this company from the brink of devastation to a strong second airline,” he said.

“These workers have stuck loyally by Virgin during the toughest time aviation has ever faced, and this is a welcome announcement that workers have deservedly called for to recognise their efforts.”

It was expected Bain Capital would seek to launch an IPO of Virgin by the end of June, and sell off as much as a 30 per cent stake.

That would leave the US private equity firm as the major shareholder, with 38 per cent of the airline, Qatar Airways with 25 per cent, the Virgin Group with 5 and Queensland Investment Corporation with 2 per cent.

Virgin Australia was delisted from the ASX in 2020 after Bain Capital bought the airline from administration and privatised the company.

Originally published as Virgin Australia promises staff shares in airline ahead of ASX return