20 buyers now circling Virgin Australia

[MickG0105]

Originally Posted by Boeingpilot738

Today’s 2.15 hearing, can anyone shed any light on what it’s actually for? To allow the Bondholders access to creditors or to allow them to present their DOCA on 4th of September? I thought the judge had already ruled on the latter?

It's to get a ruling on whether the bondholders have a statutory right to put an alternative DOCA and, if they do, how that should be managed.

There has not been a specific ruling on that point yet. What Middleton J had previously noted was that section 439CA of the Corporations Act 2001 authorises creditors to approve a DOCA which is different from the one accompanying the notice of meeting.

The more significant point not yet addressed at all is whether an alternative DOCA can undo the administrator's decision to sell the business under section 437A. It will come down to duelling rights - does the creditors' right under 439CA to approve a DOCA that is different to the one proposed by the Administrator trump the Administrator's right under 437A to sell the company's business? It's not a trivial matter and goes to the Administrator's role and rights. 437A is pretty unambiguous.

CORPORATIONS ACT 2001 No. 50, 2001 - SECT 437A

Role of administrator

(1) While a company is under administration, the administrator:

(a) has control of the company's business, property and affairs; and
(b) may carry on that business and manage that property and those affairs; and
(c) may terminate or dispose of all or part of that business, and may dispose of any of that property; and
(d) may perform any function, and exercise any power, that the company or any of its officers could perform or exercise if the company were not under administration.

(2) Nothing in subsection (1) limits the generality of anything else in it.

There will be a lot of administrators paying very close attention to this hearing. If it doesn't go Deloitte's way there would have to be a very good chance that it will be appealed.