Virgin Australia eyes 2023 re-listing – report

Bain Capital, the US private equity firm that acquired Virgin Australia Holdings through voluntary administration in 2020, is considering bailing out the parent company of Virgin Australia (VA, Brisbane Int’l) on the Australian Securities Exchange (ASX) in Sydney by the end of next year, Anonymous inside sources told the Australian newspaper. Bain delisted the ASX stake in November 2020 shortly after gaining shareholder control.

This second initial public offering (IPO) would take place once the volatility of the pandemic has passed, with the ideal time being 2023, insiders claimed. Bain could sell up to 50% of its ownership, less than three years after its takeover of the carrier, which involved a financial commitment of 3.5 billion Australian dollars ($2.5 billion).

Virgin Australia Holdings exited restructuring under new ownership of the private equity firm in November 2020 and began to forge its way as a newly oriented mid-sized airline.

According to the sources, discussions with advisers on a possible float began several months ago and will resume in mid-2022 to further assess the situation. Potential investors should have a better understanding of Virgin Australia’s revenue potential by 2023, when at least the airline’s domestic capacity will be operating under more normal conditions, they said.

Although no investment bank has yet been appointed to guide the IPO, the Australian has speculated that Goldman Sachs may get involved given its previous associations with Bain Capital.

Virgin Australia was not immediately available for comment.

Virgin Australia Holdings last month posted a surprise after-tax profit of AUD 3.7 billion (USD 2.6 billion) for the year ending June 30, 2021 – its first in nearly a decade and reversing a loss 3 billion AUD (2.1 billion USD) for the financial year 2019-20. But the profit came after administrators extinguished 4.4 billion AUD (3.1 billion USD) in creditor claims, while the carrier cut its labor costs in half, laying off more than 3,000 employees. and closed its subsidiary Tigerair Australia (TT, Melbourne Tullamarine) in September 2020. .

Due to the Omicron variant, Virgin Australia was forced to cut January and February 2022 capacity by 25% and suspend its only international route, to Nadi, which had only resumed in December. The variant has seriously affected demand for air travel in Australia, he said.

According to ch-aviation‘s advanced fleets module, Virgin Australia currently operates a fleet of fifty-nine B737-800s, two B737-700s and one Fokker 100 wet-leased from Alliance Airlines (QQ, Brisbane Int’l). It has twenty-five B737-10s on order. From the first week of February, it operates a network of 58 routes, indicates the capacity module of ch-aviation.

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