Virgin Australia (ASX: VAH) has moved onto the next stage of potentially being saved.
What is Virgin?
Virgin is a holding company for Virgin Australia International Airlines, Virgin Australia Domestic Airlines and also Tigerair Australia. Tigerair was acquired by Virgin in 2015.
What has been announced today?
The administrators of Virgin said that the airline has taken a significant step towards leaving voluntary administration with a new owner. A shortlist of parties has been made for the next stage.
Each potential buyer is well funded and has “deep aviation experience”. They have put forward credible bids which can save the job of thousands of employees.
Who are those potential bidders?
Lead Partner for the Administrators, Vaughan Strawbridge, said: “We cannot comment on who the shortlisted parties are due to confidentially commitments but we will be working intensely with them over the next four weeks to enable binding offers by mid-June. This will involve the sharing of more detailed financial and operational information, management workshops and meeting with as many of the financiers, landlords, suppliers, unions and other stakeholders of the business as possible.”
But apparently the Australian Financial Review apparently has the shortlist. The names are Bain Capital, BGH Capital, Indigo Partners and Cyrus Capital Capital Partners.
It seems Brookfield, which was much talked about as a potential bidder, didn’t make the shortlist because it didn’t want to be involved with so many bidders.
It’ll be interesting to see what happens next, and how will Qantas (ASX: QAN) respond to the saved Virgin? I think I’d rather stick to investing in technology shares over airlines:
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Disclosure: at the time of publishing, Jaz does not have a financial interest in any of the companies mentioned.
