Virgin Australia administrators say they have agreed to sell the airline to Bain Capital.
The news came in an announcement to the ASX on Friday morning, just hours after rival bidder Cyrus Capital Partners withdrew its offer for the airline, citing a lack of engagement from administrators.
Cyrus and private US investment firm Bain Capital were the two early final bidders for Virgin, which went into administration in early April.
On Wednesday, Virgin Australia’s debtholders lodged an 11th-hour bid for the airline that they said aimed to revitalise it with a supply of $1 billion in cash while also safeguarding staff entitlements and honouring frequent flier points and flight credits.
Explaining its shock announcement on Friday, Cyrus said Virgin’s administrator, Deloitte, had failed to return its calls.
“On the morning of 22 June 2020, Cyrus presented to the administrators of Virgin Australia Holdings an offer to acquire the airline, its regional business and the frequent flyer program Velocity, in accordance with the administrators’ procedures,” it said.
“However, since then, the administrators have not returned calls, emails, or meaningfully engaged with Cyrus to progress its offer.”
Cyrus said on Thursday it submitted a further package of “value improvements” and “other compelling measures” to try to sweeten the deal, including for unsecured bondholders. It still heard nothing from the administrators, other than an acknowledgement its message had been received.
However, Cyrus founder and chief investment officer Stephen Freidheim left open the door to a renewed bid.
“Cyrus firmly believes that the Australian aviation industry has a bright future and would be willing to re-instate our offer if the administrators agree to re-engage in good faith, productive discussions with a view to concluding a transaction that will benefit all key stakeholders — employees, customers, Velocity members and bondholders,” he said.
-more to come