Both Cyrus and Bain are edging towards their modus operandi. They have no intention of risking much of their own capital, but play the ringmaster of a three ring circus.
Last week they made it clear that without government/taxpayer money and guarantees then it will struggle to get off the ground.
This week it introduces the possibility of other investors, notably other airlines that may strategically benefit from an Australian domestic airline as well as current bond holders receiving a share of the airline rather than cents in the dollar on their investment.
The third ring of the circus is a buy in from
the employees. This typically involves two components. Firstly employees receive a share of the company in exchange for accrued benefits. Secondly employees take a “temporary” reduction in remuneration until the company becomes profitable.
Venture Capitalists don’t risk their own capital. They are the masters of bringing interested parties together who see personal advantage in an otherwise risky investment.
Last edited by Progress Wanchai; 15th Jun 2020 at 07:21.