Virgin Australia Financially Secure? [Now in Voluntary Administration]

[Quickstatus]

Shareholders and unsecured bondholders = zero.

Administrators is essentially a price taker in an environment where there is not a lot of capital around prepared to take a risk.

Next...

 

[travel_bug]

Virgin Australia attracts 20 interested bidders

Virgin Australia administrator Deloitte says eight of these bidders had signed non-disclosure agreements and negotiations continued with the rest after its first meeting with creditors on Thursday.

www.afr.com

As anticipated, only big news from the meeting are the nominees for the committee of inspection. Once that's been voted on, any future resolutions should be a lot easier to decide on, including I imagine, the terms of any DOCA.

The meeting wrapped up in just over an hour, with a large field of nominees for the committee of inspection which will oversee the administration.
These nominees included Aircraft Leasing (S), Airline Cleaning Services, Alliance Airlines, Association of Virgin Australia Group Pilots (VIPA), Australia Pacific Airports (Melbourne), Australian Council of Trade Unions, Australia, Australian Licensed Aircraft Engineers Association, Australian Manufacturing Workers Union and the Australian Services Union,
Boeing Training & Flight Services Australia, Brisbane Airport, Canberra Airport, Carlson Wagonlit Travel Australia, Dell Financial Services, Electrical Trades Union, FIIG Securities, Flight Attendants Association of Australia, Gold Coast Airport, JPA No. 123, Mathew James Purton were also listed.
Northern Trust Asset Management, Perth Airport, Sabre GLBL, Skywest Airline Pilots Association, Sargon CT, Sydney Airport, The Bank of New York Mellon, Transport Workers Union of Australia, Velocity rewards and Wilmington Trust Company rounded out the list.
A vote on the committee will take place next Tuesday and Deloitte is expected to issue a statement shortly.

 

[jase05]

Twiggy throwing his hat in the ring?

Mining magnate Andrew ‘Twiggy’ Forrest planning a Virgin Australia takeover

Australian mining magnate Andrew Forrest is planning a bid for Virgin Australia after the failing airline fell into administration last week.

amp.news.com.au

 

[Quickstatus]

What is VA net asset position?

..........

The quickest way to be a millionaire is to start of as a billionaire owning an airline

Twiggy throwing his hat in the ring?

 

[jakeseven7]

Twiggy throwing his hat in the ring?

Mining magnate Andrew ‘Twiggy’ Forrest planning a Virgin Australia takeover

Australian mining magnate Andrew Forrest is planning a bid for Virgin Australia after the failing airline fell into administration last week.

amp.news.com.au

Circling a wounded bleeding whale like a shark!

 

[Melburnian1]

Virgin Australia Group Holdings and its numerous associated companies are being run by four administrators from Deloittes and have not been wound up.

But can someone with experience in administrations or corporate insolvencies explain how the administrators can continue to pay '9020 staff' as there are 'no plans for (further) redundancies?'

The Federal Government's JobKeeper scheme ($1500 per fortnight per employee) must be playing a role but there's still presumably much money going out the door in salaries and wages if staff are still to be paid once accumulated annual or long service leave is extinguished.

And administrators identified that employees were owed about $450 million when Deloittes took over.

Given operations are so minimal at present - a few government-guaranteed flights each week for eight weeks, and some VARA mining-related charters/regfular flights - how can keeping 9020 staff on the books be justified when no one yet knows what will occur with the adminstration?

The next creditors' meeting is likely not to be until 22 August 2020, showing the complexity of the process.

 

[Quickstatus]

But can someone with experience in administrations or corporate insolvencies explain how the administrators can continue to pay '9020 staff' as there are 'no plans for (further) redundancies?'

I think while in administration, they are paid from the assets of the business and classed as an expense of the administration - basically sits at the top of the totem pole.

So when the business is sold, the totem pole (priority of payment) is realised and isin rank order:

(1) Administration expenses
(2) Secured creditors
(3) Priority unsecured creditors (employees) - in rank of priority (this is when there is a sudden liquidation or bankruptcy - not in VA's case)
........(a) wages and super
........(b) leave entitlements
........(c) redundancy payments
(4) Unsecured creditors including ATO for tax debt
(5) Shareholders

In liquidation or bankruptcy, (3) may be covered by the Attorney General's FEG.
In some extreme cases there are no assets, so not even the secured creditors get a payment and possibly the Administrator/liquidator may not get paid at all but still has statutory obligations to fulfill.

 

[clarkkent]

Andrew Forrest joins 20 bidders circling Virgin Australia

There are 20 interested parties and there is growing speculation that some groups might team up to bid for the company.

www.smh.com.au

20 suitors.

Deloitte said on Thursday eight bidders had signed non-disclosure agreements and now have access to Virgin's dataroom, and it was negotiating with a further 12.

Suitors will be given access to a management plan for the relaunched airline - or "Virgin v2.0" - next Tuesday, according to slides from the meeting seen by The Sydney Morning Herald and The Age. Virgin chief executive Paul Scurrah and his management team are working with Deloitte on restructuring plans.

 

[Quickstatus]

20 suitors.

Sort of like a used care salesperson saying there is strong interest in the vehicle you are looking at.

 

[travel_bug]

I feel like at this point any semi-prominent business person or company that's googled "Virgin" in the past year is now having a speculative article written on how they're putting in a bid.

What are the bets that the next article will include Gina Rhinehart or Anthony Pratt?

 

[RAM]

I feel like at this point any semi-prominent business person or company that's googled "Virgin" in the past year is now having a speculative article written on how they're putting in a bid.

What are the bets that the next article will include Gina Rhinehart or Anthony Pratt?

If one wanted to have real fun - Warren Buffett....

 

[jakeseven7]

I feel like at this point any semi-prominent business person or company that's googled "Virgin" in the past year is now having a speculative article written on how they're putting in a bid.

Which is exactly what happened to Ansett

 

[travel_bug]

If one wanted to have real fun - Warren Buffett....

Only if the VA Mk II TV ads include Branson lifting him up Kate Moss style

 

[jakeseven7]

Only if the VA Mk II TV ads include Branson lifting him up Kate Moss style

And chucking Branson off a cliff afterwards as they celebrate him no longer being involved hopefully!

 

[tomlee1986]

Andrew Forrest joins 20 bidders circling Virgin Australia

There are 20 interested parties and there is growing speculation that some groups might team up to bid for the company.

www.smh.com.au

20 suitors.

Hate to be blunt... but to me.. this basically looks like 20 sharks smelling blood and waiting to take the first bite!

 

[Quickstatus]

No looks like the administrator trying to manufacture a bidding war when there is none. Maybe its for public consumption. The real story is behind the scenes.

 

[tomlee1986]

No looks like the administrator trying to manufacture a bidding war when there is none. Maybe its for public consumption. The real story is behind the scenes.

I was too young at the time - was thinking if Ansett had the same type of "interest" when they were on their last legs?

 

[hydrabyss]

This is all I could get from the article.

It comes as the West Australian billionaire is also believed to be considering a tilt at the collapsed airline Virgin Australia through investment bank Credit Suisse as the first creditors meeting for the carrier was held Thursday.

 

[Quickstatus]

Nothing like a bit of generating a bit of media interest to stoke the fires. But I think the investor(s) are a bit more sophisticated than that. Thats why I think the media interest is for public consumption - especially the ones who have a few VFF

 

[Carrots]

Maybe, just maybe, the Administrators are working feverishly to provide AFF'ers with something new and exciting (and maybe controversial?) to discuss at great depth... and then in 8-10 weeks time we'll all be flabbergasted at the final outcome that we did not see coming, except for that one person who made an extremely vague comment about something at some point and will claim it as proof they were correct