Virgin Australia Financially Secure? [Now in Voluntary Administration]

[jase05]

This is only gossip not fact but speaking to a friend who is a low to medium level bean counter at Wesfarmers and the work chatter seems to suggest that they probably won’t end up as owning VA. He did mention that Branson has been approaching interested parties about increasing his stake and wants to stay involved with the new setup. Again this is all just rumours

 

[jase05]

Interesting points from an article in the Australian


Mr Strawbridge said it was hoped Virgin Australia could be sold as a single entity rather than break up the group, which included low-cost carrier Tigerair.

The Velocity frequent flyer program was not in administration but would be offered as “part of the package” and all frequent flyer points preserved, he said.

Customers with travel credits could also be reasonably confident they would get to use those vouchers but Mr Strawbridge noted there could be “no guarantees”.

NoCookies | The Australian

www.theaustralian.com.au

 

[jakeseven7]

This is only gossip not fact but speaking to a friend who is a low to medium level bean counter at Wesfarmers and the work chatter seems to suggest that they probably won’t end up as owning VA. He did mention that Branson has been approaching interested parties about increasing his stake and wants to stay involved with the new setup. Again this is all just rumours

But Branson had no money 18 hours ago to help VA or VS I'm dreadfully confused where his money has suddenly materialized from.... COUGH F.O.S COUGH

I'm sure Wesfarmers are FAR more interested in Velocity than VA.

 

[Must...Fly!]

This is only gossip not fact but speaking to a friend who is a low to medium level bean counter at Wesfarmers and the work chatter seems to suggest that they probably won’t end up as owning VA. He did mention that Branson has been approaching interested parties about increasing his stake and wants to stay involved with the new setup. Again this is all just rumours

He is a billionaire for a good reason. His wealth and his legacy is Virgin itself - if he thinks he can outlast COVID, there is a lot of money to be made as other airlines downsize big time. VA with the restructuring could (could) be a financial beacon for the Virgin group.

Obviously he doesn't want to spend his money if he doesn't have to but with the wipeout of other equity investors, he probably eyes a golden opportunity for the future. Wasn't there a news story his private island was going to stake him? That's a big risk and he's obviously active exploring taking it.

 

[woodborer]

This is only gossip not fact but speaking to a friend who is a low to medium level bean counter at Wesfarmers and the work chatter seems to suggest that they probably won’t end up as owning VA. He did mention that Branson has been approaching interested parties about increasing his stake and wants to stay involved with the new setup. Again this is all just rumours

I'd assume that there will be a bunch of tyre kickers. But Wesfarmers are always on the lookout and will no doubt run a ruler over it. It may not meet their criteria though - but that doesn't stop them looking at it.

Post automatically merged: Apr 22, 2020

But Branson had no money 18 hours ago to help VA or VS I'm dreadfully confused where his money has suddenly materialized from.... COUGH F.O.S COUGH

I'm sure Wesfarmers are FAR more interested in Velocity than VA.

Branson was a maybe will invest more, rather than the "no" of the other main shareholders

 

[AisleSeat]

What would Westfarmers call "VA Mk II"? -

FlyBuys Airways, Coles Air, Air Kmart? Bunnings Express?

https://twitter.com/i/web/status/1252797943515500550

Now sing the Bunnings jingle, substituting "airlines" for "warehouse". It fits perfectly.

 

[flyingfan]

Interesting concepts around Bunnings buying VA but I don't think it'll happen. They must be thinking about the joke on how to make a small fortune in the airline industry.

 

[mrbraun]

well, bunnings is part of wesfarmers...

 

[Danger]

Time for VA to wrap itself in the flag. QF do it with the kangaroo, perhaps we can have an Emu, Koala or Echidna on the tail?

I don't "get" the rationale that says Qantas cannot fail and Virgin can.
Qantas milks the heritage teat for every drop and all but demands "national Icon" protection.
VA.. struggling along (as airlines) do… kept the b's honest.
Do I think the taxpayer should bail Va.. no I do not.. but the noisy roo should be treated 'zactly the same if it comes bleating for more favour.

I agree. I've long believed that the biggest thing Qantas has going for it is its logo. If you took that away and if Peter Allen's anthem was never part of the scene, I reckon Australians wouldn't have half the attachment to Qantas that they do now. On the flipside, the 90s marketing team has paid for itself in droves.

The media are shi***ng me right now saying VIRGIN COLLAPSE. I think we need some education for the media about the difference between Administration and Liquidation. In their defence their point of reference is Ansett.

Your sentence didn't need the "about the difference between administration and liquidation". Journalistic standards in this country are very poor from an English language perspective. A Nine Fairfax article on the Sydney Morning Herald website yesterday said, "Virgin Australia co-founder Richard Branson ... signalled his involvement in the company could go passed the administration" (emphasis added).

Latest news circulating :

Victoria confirms $500m bid for Virgin. The state's government confirmed that it considered a bid with Lindsay Fox to save the carrier. Deloitte has outlined seven reasons to buy Virgin. Follow our live coronavirus blog and track how the infection is spreading.

Lindsay Fox? The same Lindsay Fox who stuck is toe (foot) in with Ansett?

 

[RAM]

LMAO!!

Funniest post of the day (not sure if you meant it to be but anyway)

Class action against the government if they need support the national carrier lol sure thing

Not really so funny actually - the Federal Govt has been on the losing end of multiple class actions for different reasons in the last two years.

The latest one being the PFAS debacle & Defence Bases, soon to expand to Australian domestic & international airports...

PFAS settlement worth $212.5m to be paid to victims by ...
www.smh.com.au › National › Pollution


Mar 11, 2020 - The federal government will pay out $212.5 million to settle three class actions launched by victims of toxic firefighting contamination across .


The Fed Govt settled after getting scathing comments from the designated Justice. Along the lines of trying to bleed the people to death by unjustifiable delaying actions.

 

[antycbr]

Not really so funny actually - the Federal Govt has been on the losing end of multiple class actions for different reasons in the last two years.

The latest one being the PFAS debacle & Defence Bases, soon to expand to Australian domestic & international airports...

PFAS settlement worth $212.5m to be paid to victims by ...
www.smh.com.au › National › Pollution


Mar 11, 2020 - The federal government will pay out $212.5 million to settle three class actions launched by victims of toxic firefighting contamination across .


The Fed Govt settled after getting scathing comments from the designated Justice. Along the lines of trying to bleed the people to death by unjustifiable delaying actions.

Particularly if they (creditors/bondholders) can link their loss to actions of Government which would appear to be a valid point.

 

[travel_bug]

Not really so funny actually - the Federal Govt has been on the losing end of multiple class actions for different reasons in the last two years.

The latest one being the PFAS debacle & Defence Bases, soon to expand to Australian domestic & international airports...

PFAS settlement worth $212.5m to be paid to victims by ...
www.smh.com.au › National › Pollution


Mar 11, 2020 - The federal government will pay out $212.5 million to settle three class actions launched by victims of toxic firefighting contamination across .


The Fed Govt settled after getting scathing comments from the designated Justice. Along the lines of trying to bleed the people to death by unjustifiable delaying actions.

There's no argument in that class actions can be raised against the Gov, and that the Gov is held to higher standards in such litigation through the Model Litigant Guidelines under the Legal Services Directions (and should respect such guidelines and treat plaintiffs accordingly).

However, the PFAS cases stem from an argument on whether the Gov has breached its duty of care or has been negligent in one way or another. The argument is that the Gov should not have allowed the continued use of a harmful substance and should have to answer to the harm that has occurred (and will continue to occur) because of it.

How do you start a class action against the Gov for not giving money to a particular business that isn't entitled to it? Although anything is arguable in law, why does the Gov have to give VA money, or support people/organisations who consciously invested into an organisation that was already making a loss?

Investments inherently carry risk, and the Gov did provide support to the airlines through underwriting the domestic network, subsiding certain fees and excise, and even subsidising the workforce through JobKeeper. I would argue that just because VA was in a precarious position before the pandemic does not make the Gov liable when their actions so far have arguably been in the public good.

 

[antycbr]

There's no argument in that class actions can be raised against the Gov, and that the Gov is held to higher standards in such litigation through the Model Litigant Guidelines under the Legal Services Directions (and should respect such guidelines and treat plaintiffs accordingly).

However, the PFAS cases stem from an argument on whether the Gov has breached its duty of care or has been negligent in one way or another. The argument is that the Gov should not have allowed the continued use of a harmful substance and should have to answer to the harm that has occurred (and will continue to occur) because of it.

How do you start a class action against the Gov for not giving money to a particular business that isn't entitled to it? Although anything is arguable in law, why does the Gov have to give VA money, or support people/organisations who consciously invested into an organisation that was already making a loss?

Investments inherently carry risk, and the Gov did provide support to the airlines through underwriting the domestic network, subsiding certain fees and excise, and even subsidising the workforce through JobKeeper. I would argue that just because VA was in a precarious position before the pandemic does not make the Gov liable when their actions so far have arguably been in the public good.

I think the issue is preferential support to QF after a liquidation of VA. This is possible if VA collapses QF will be in a very strong negotiating position, effectively “help us or else”.

 

[travel_bug]

I think the issue is preferential support to QF after a liquidation of VA. This is possible if VA collapses QF will be in a very strong negotiating position, effectively “help us or else”.

But even in that case, what is the obligation on the Gov to have given a majority owner foreign entity a bailout or loan, or conversely, why should they not offer support to the flag carrier 51% Australian owned? I just don’t see the legal negligence that would lead to a viable class action as can be seen in PFAS cases.

 

[jakeseven7]

I agree. I've long believed that the biggest thing Qantas has going for it is its logo. If you took that away and if Peter Allen's anthem was never part of the scene, I reckon Australians wouldn't have half the attachment to Qantas that they do now. On the flipside, the 90s marketing team has paid for itself in droves.

They could move to the Ansett logo that had the flag on the tail , looks quite nice from the photos!

Airbus A320-211, Ansett Australia, F-WWDI, VH-HYJ (MSN 142) | AIB Aviation Flights

Airbus A320-211, Ansett Australia, F-WWDI, VH-HYJ (MSN 142) | Crowdfunded Data Analytics of the Airbus Family Test & Delivery Flight Activity

aibfamily.flights

 

[jakeseven7]

A warning for the weak

The collapse of Virgin Australia Holdings Ltd. after the briefest of fights indicates the world’s weakest airlines have little time to secure funds before they succumb to the coronavirus.

The debt-laden carrier became the outbreak’s biggest airline scalp when it handed control to administrators on Tuesday. A near-halt in passenger revenue overwhelmed the Brisbane-based company in less than two months.

Denied a Bailout, Virgin Australia a Warning for Other Airlines

The collapse of Virgin Australia Holdings Ltd. after the briefest of fights indicates the world’s weakest airlines have little time to secure funds before they succumb to the coronavirus.

www.bloomberg.com

 

[RooFlyer]

I agree. I've long believed that the biggest thing Qantas has going for it is its logo.

Which they've progressively been amputating bits off for years ... the wings, the paws ...

 

[antycbr]

But even in that case, what is the obligation on the Gov to have given a majority owner foreign entity a bailout or loan, or conversely, why should they not offer support to the flag carrier 51% Australian owned? I just don’t see the legal negligence that would lead to a viable class action as can be seen in PFAS cases.

It's still a private sector entity (as far as I can tell neither are flag carriers in terms of having preferential rights) and the government has clearly stated that market based solutions must be used, establishing a precedent. There was still 9% of VA owned by some long suffering Australian shareholders too.

While you have more legal knowledge than I do, if I was a bondholder losing billions of dollars I'd be looking at the public pronouncements of the Government (and there has been a lot of them!) quite closely.

Edit: The government has stated that they won't be the lender of last resort for VA so that must now apply equally for QF.

 

[cambriamarsh]

Summary from an AFR article today

Former Virgin Blue chairman Chris Corrigan, who was in charge of the airline when it was one of the most profitable in the world, says the new owners of Virgin Australia need to go back to basics or be replaced by a new airline.

Given his history probably worth listening to.

 

[jakeseven7]

Summary from an AFR article today

Former Virgin Blue chairman Chris Corrigan, who was in charge of the airline when it was one of the most profitable in the world, says the new owners of Virgin Australia need to go back to basics or be replaced by a new airline.

Given his history probably worth listening to.

It is an interesting proposition and certainly very popular one - everyone is talking about it.

The challenge with that strategy now, though it worked before is: Jetstar.

Back then Jetstar was still fledgling, a handful of planes and not much penetration.

Today it is a large airline in its own right, a cost base far lower than VA (they would have to hack their own feet and arms off to get back there - reports have them equal to QF mainline now).

To get back to a true LCC would mean facing off with Jetstar and also basically handing all premium pax back to Qantas on a silver platter.