Virgin Australia’s administrator, Deloitte, has shortlisted the final two bids for the now collapsed airline. The two parties are expected to lodge their final bids to Head Administrator Vaughan Strawbridge, a decision is expected to be made on 30th June.
“Five non-binding indicative proposals were received on Friday, and they have now been further short-listed to two preferred bidders. Both Bain Capital and Cyrus Capital Partners are well-funded, have deep aviation experience, and they see real value in the business and its future.”
Vaughan Strawbridge, Virgin Head Administrator (via ABC)
Bain and Company
Boston-based investment firm Bain & Co is putting forward a case for Virgin Australia, by using local aviation knowledge. Bain’s pitch for Virgin is being aided by former Jetstar CEO Jayne Hrdlicka, who also served as a senior executive for Qantas. The ABC has reported that Ms Hrdlicka could take over as Virgin Australia CEO, provided Bain wins the bid purchase the airline.
Bain has said that it will give Virgin a “sustainable, long term future” and there is speculation that Bain will change Virgin’s model to remove the full-service element. The relaunched airline would be a hybrid airline of Virgin Blue, Virgin Australia’s predecessor.
Virgin Blue operated with a lost-cost model, but a Bain-backed Virgin Australia would potentially offer airport lounges, a revamped frequent flyer scheme and also include regional and international services as the market rebounds. The new Virgin would sit somewhere between Qantas and Jetstar in terms of service.
Mike Murphy, the firm’s Sydney-based Managing Director, told The Australian that Bain wanted to “make flying fun again,”
“One thing we would love to explore is whether there could be a closer brand relationship between Virgin and Velocity. We come at that from the customer experience. Having those tied up a little closer could be a more seamless experience from both the web and app perspective for customers.”
Mike Murphy (via The Australian)
Bain acquired Trans Maldivian Airlines in December 2017 and the seaplane operator now operates on a consortium of owners.
Cyrus Capital Partners
New-York based Cyrus manages approximately $4 billion worth of investments globally. The firm has a history of managing airlines, having launched Virgin America in partnership with Richard Branson in 2005.
Cyrus intends to keep Virgin Australia as a full-service airline, which would see direct competition with Qantas once again. The union representing Virgin flight crews has expressed a desire for the airline to remain full service, thus resulting in less redundancies.
Cyrus, together with Branson’s Virgin Atlantic, also invested in now-defunct UK-based Flybe.
Final bids are due on 12th June.
Article Sources: ABC, Sydney Morning Herald and The Australian