WHAT IS VOLUNTARY ADMINISTRATION?
Just because
Virgin Australia has gone into voluntary administration, does not automatically mean it has disappeared forever.
When a company is facing grave financial difficulties (such as running expenses vastly out-stretching income coming in), it becomes insolvent.
Virgin may be sold to a buyer. (AAP)
To fix this, a business appoints an independent administrator who effectively runs a detailed accountancy check of the business to slash unnecessary costs.
Voluntary administrators may make several recommendations to help save a company, which include: finding a buyer to purchase the business as a complete package, or restructuring to cut down on overhead costs.
Most large-scale businesses such as
Virgin Australia have already investigated extensive restructuring methods, so it largely comes down to whether the airline presents an attractive opportunity for a multinational with deep pockets.
...