Virgin Australia to be sold to Bain Capital

[eastwest101]

Personally, having a conditional credit myself and with the info that Bain will honour these, unless something to the contrary appears, I'd be voting for, not against that deal.

[Hypothetical] If someone was prepared to offer you cold hard cash 125-200% of the face value of your travel bank, in return for your creditor proxy would you refuse?

What if it looked like the Bain bid might fall over? Would that change your mind Serfty ?

 

[serfty]

Hypothetically - I should stand to save much more on fares if VA were not liquidated. This was a trans-Tasman I class fare.

I doubt the Bain bid would fall over.

So, no.

 

[Aus ATC]

A bit of digging around - this Proof of Debt Form is available on the Deloitte Web Site. Along with some FAQs. I might just get Mrs Aus ATC to fill it in.

 

[jakeseven7]

Virgin sale at risk as bondholders plan last gasp bid


Virgin's adminstrators are sticking with a plan to sell the carrier to Bain Capital despite renewed hope among aggrieved bondholders that creditors will be able to consider a last gasp bid from them to resurrect the stricken airline.

Bondholders dropped their Takeovers Panel application following a Federal Court hearing where they revealed they would put forward a formal deed of company arrangement for creditors to consider alongside an offer from Bain at an upcoming meeting in August.

Virgin sale at risk as bondholders plan last gasp bid

The battle to take control of the stricken carrier is far from over after a court challenge by aggrieved bondholders.

www.smh.com.au

 

[MarkD]

Virgin sale at risk as bondholders plan last gasp bid


Virgin's adminstrators are sticking with a plan to sell the carrier to Bain Capital despite renewed hope among aggrieved bondholders that creditors will be able to consider a last gasp bid from them to resurrect the stricken airline.

Bondholders dropped their Takeovers Panel application following a Federal Court hearing where they revealed they would put forward a formal deed of company arrangement for creditors to consider alongside an offer from Bain at an upcoming meeting in August.

Virgin sale at risk as bondholders plan last gasp bid

The battle to take control of the stricken carrier is far from over after a court challenge by aggrieved bondholders.

www.smh.com.au

They have done their money. They took the high risk, high gain gamble and lost. If it was guaranteed returns on high risk investment, everyone would do it. Hope Bain persist and don't walk away, if they do virgin is stuffed and so are all VA jobs.

 

[jakeseven7]

They have done their money. They took the high risk, high gain gamble and lost. If it was guaranteed returns on high risk investment, everyone would do it. Hope Bain persist and don't walk away, if they do virgin is stuffed and so are all VA jobs.

I agree re: bondholders.

But I'm actually getting more and more concerned by the day that Bain is looking at the spread of the virus here (the state governments reaction with their border closing) and wondering what on earth they are going to do to try and make some money in the short/medium term....

Remember then Bain was concluding all this - everything was looking a lot more rosy.

Now we have ad hoc border closures in response to the virus spread and probably more coming.

I would not be surprised at all if Bain walked away. I hope not, but would not be surprised. Maybe they think the High Court will overturn the states and open borders.... who knows?

 

[RAM]

I agree re: bondholders.

.... UNSECURED bondholders...

 

[MooTime]

Sorry, but I'm a little mystified on how this group of what type of creditors they are / want to be referred to as can just lodge an 11hr 59min bid??
I mean there was that Brookfield bid that seemed to be not looked at & knocked on the head so how has this team started singing all of a sudden, I understand their investment into Virgin now looks rather poor & I feel bad for what it's worth to see anyone lose money on an investment, but unfortunately that's part of the investing game.
Why couldn't they mount this bid much much earlier, how about when the apparent 20 or so groups did. We've heard this circa6.5c return for a long time now.

Either way I just don't see how they can be allowed to mount this bid so late.
And how do they expect to see the complete Bain bid, well if they did they just better it in the areas that will win the req'd amount of votes & they win, take Virgin.
If that was the case, could & if not why not Bain to see these bondholders final bid & then themselves up their bid a little. Just seems silly & cat n mouse to me, with such dire consequences, Bain could walk & Virgin stuck with who? bunch of angry folk who lost money, who knows if they anything abut running an airline.

Just my opinion.

 

[jakeseven7]

Bain could walk & Virgin stuck with who? bunch of angry folk who lost money, who knows if they anything abut running an airline.

Just my opinion.

I'm not sure Bain would walk because of the bondholders bid..... But maybe they use it to get out of buying VA because the situation has deteriorated and flying widely domestically is not such a sure bet anymore, certainly while the High Court decision is out and the states can put up their borders whenever they like in response to their virus level tolerances...

 

[RooFlyer]

Either way I just don't see how they can be allowed to mount this bid so late.

As I understand it, the are not being 'allowed' to make their bid, they are just doing it, direct to the creditors. I doubt the bondholders would get a time slot in the creditor's meeting, so they might just hold up a shiny placard at the meeting entry saying "Psssst .. wanna better deal? .. talk to us" ... or maybe something more sophisticated than that. If somehow the main$ majority/numbers creditors perceive the bondholder offer better than what they are hearing from Deloittes/Bain, perhaps they could vote to defer a decision and either ask Deloitte to assess the bondholder offer (unlikely - who would pay?) or decide to formally assess it themselves. I don't know how flexible the creditors can be outside of the Administrator, but as the Administrator was appointed by the company (ie Voluntary Admin), maybe their only permitted response is yes or no or renegotiate the existing offer.

I mean anyone could offer anything to the creditors, outside the Administrator process in an attempt to snatch the 'prize'. The bondholders seem to have gone about it in a cack-handed way either out of getting bad advice or as a deliberate disruptive tactic.

 

[Carrots]

I would not be surprised at all if Bain walked away. I hope not, but would not be surprised. Maybe they think the High Court will overturn the states and open borders.... who knows?

They walked in eyes wide open, you don't walk into a room to spend a few billion denaro's without knowing the risk in the current environment.

And if they didn't, then they shouldn't be allowed to breath. Or alternatively they could work for the government

 

[equus]

I doubt the bondholders would get a time slot in the creditor's meeting

If they actually come up with a formal proposed DOCA, I think it most unlikely that they wouldn't get a shot. The creditors are the ones that vote, and the Administrators would be in a bit of a tight spot if they didn't let the creditors vote (they could obviously place their recommendation). As creditors, themselves, the bondholders are entitled to be present and heard, and any attempt by the Administrators to exclude them would probably see these bondholders running back to the court to challenge the outcome of the meeting - and that is the last thing that anybody else would want.

 

[moa999]

Article in the AFR today that Bain has already put $125m into Virgin (presumably with some fairly hefty conditions)

And a suggestion that unsecured bond holders (total $2bn) will get hundreds of millions from the DOCA.

As above bond holders have withdrawn their Takeovers Panel submission (which afaik had little chance of success) and are seeking to put forward an alternative DOCA.

 

[RooFlyer]

If they actually come up with a formal proposed DOCA, I think it most unlikely that they wouldn't get a shot. The creditors are the ones that vote, and the Administrators would be in a bit of a tight spot if they didn't let the creditors vote (they could obviously place their recommendation).

Yes, you might be right. Although an on-line story in the Oz just now (probably pay-walled, sorry) speaks to the situation (but how informed, as ever is anyone's guess My bolding.

Deloitte defends how it handled Virgin Australia administration

“The sale to Bain Capital means we have achieved a big part of the objectives we set when we were appointed administrators, being the airline is able to continue to operate, the number of jobs retained is maximised, and the best outcome can be delivered for all creditors as the business comes out of voluntary administration as soon as possible.”

He said the Committee of Inspection, made up of 35 creditors and their representatives, had endorsed the sale process undertaken by Deloitte.

[Comment: Endorsed ... by positively wring such, or by not doing anything else? ]

...

The next step in the process was the second creditors meeting on August 22, at which creditors would vote on whether to complete the sale to Bain Capital via a Deed of Company Arrangement (DOCA).

Mr Strawbridge said the alternative was a traditional asset sale, that would take significantly longer to achieve, and be a costly exercise.

“The return to unsecured creditors is expected to be significantly better if terms of a DOCA is approved by creditors at the second meeting,” he said.

An alternative proposal, such as that being prepared by bondholders, would only be put to creditors if the administrators determined it represented a better deal for all those concerned.

A creditors report, including details of the sale to Bain Capital would be distributed to creditors five business days before the meeting.

 

[RAM]

If they actually come up with a formal proposed DOCA, I think it most unlikely that they wouldn't get a shot. The creditors are the ones that vote, and the Administrators would be in a bit of a tight spot if they didn't let the creditors vote (they could obviously place their recommendation). As creditors, themselves, the bondholders are entitled to be present and heard, and any attempt by the Administrators to exclude them would probably see these bondholders running back to the court to challenge the outcome of the meeting - and that is the last thing that anybody else would want.

This seems to be a cross between 'Liars Dice' and 'Poker'.

The financial resources of the two 'groups' supposedly leading the charge for the unsecured bondholders appears such that they would not be able to have funded the $125m alleged to have been put in by Bain so far. It would be interesting to see if they've paid the Federal Court costs yet...

It really does say much about how pathetic the Australian Regulatory environment has become. As both groups are not domiciled within Australia it seems they can do or say anything without being called to account (so far) - at least that is HOW the Australian Regulators have let it play out.

The process for Voluntary Administration is set down by statute - it is not something anyone can legally make up on the run - yet that is the impression virtually all the traditional media keep presenting. Curious to say the least.

If the Bain's DOCA does not get up (odds on it is a better bet to win than Winx was!) - then unsecured bondholders/creditors will get less than zero. Really does make one wonder who is the puppet-master here!

 

[jakeseven7]

Exactly what we have been discussing on here this article...

I think we are only days/couple weeks away from QLD closing borders to NSW due to the outbreak in Sydney and then basically VA (and QF for that matter) are neutered again with the big three states and the golden triangle eliminated.

CAN VIRGIN DEAL SURVIVE VICTORIA’S LOCKDOWN?

Virgin Australia suitor Bain was always going to walk away from international flights but it wouldn’t have expected domestic ones to continue to be tied down....

No Cookies | Herald Sun

No Cookies

www.heraldsun.com.au

 

[oz_mark]

I'd be surprised if Bain hadn't considered the possibility...

 

[I love to travel]

It's a long time between now and the creditors meeting, anything can change so I don’t think Bain would be rushing to pull out just yet.

 

[RooFlyer]

I'd be surprised if Bain hadn't considered the possibility...

Me too. Refer my post about 'Monte Carlo simulation' somewhere above. If they didn't do it that way, then the basic sensitivity analysis would have included a very bad COVID scenario (if it didn't, then ) and they would have weighted that possibility and financial result. Like I said, MC analysis does it elegantly.

 

[jakeseven7]

Me too. Refer my post about 'Monte Carlo simulation' somewhere above. If they didn't do it that way, then the basic sensitivity analysis would have included a very bad COVID scenario (if it didn't, then ) and they would have weighted that possibility and financial result. Like I said, MC analysis does it elegantly.

No doubt but the possibility of a very bad COVID scenario (for an airline) has increased significantly over the last few days however.