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Virgin Express arm close to rescue deal
Its amazing the way the media can inform us before management think the drones are worth bothering about.....
WillGoodbodyDublin ,Ireland, March 4 2001Virgin Express Ireland, the Irish
arm of theBrussels-based low fares airline, is close to completing a deal
with apotential buyer.
The airline's last remaining route out ofIreland, from Shannon to Gatwick, is
due to cease operations on March 12 if abuyer has not been found.
Chief executive Martin Hamrogue said the companywas still negotiating with
two groups of foreign private investors.
It is understood that one of the consortiacomprises a group of British
investors.
Hamrogue said he remained confident that a dealcould be struck in time to
save the 160 jobs at the Irish division of VirginExpress, which is part of
Richard Branson's Virgin Group.
The parent company had set a deadline of lastWednesday for the completion of
the deal.
Hamrogue said significant progress was expectedfrom the discussions this
week.
"Things are proceeding, but it is nothappening as quickly as we would
like," he said.
Hamrogue said he was unsure what would happen tothe Gatwick route if the deal
is not completed by March 12.
A consortium comprising the Russian airlineAeroflot and headed by Tom Kane,
the owner of Adare Manor Hotel in CountyLimerick, made an unsuccessful bid
for Virgin Express.
"When they made the announcement in lateDecember that they were going to
close, I had discussions with a number ofpeople in the region and we
indicated an interest," Kane told The SundayBusiness Post.
"We went through the process but, when itappeared that there were a
couple of other viable buyers and it looked like itwas going to turn into a
bidding contest, we decided to withdraw. I had feltthat Virgin Express had
frittered away an awful lot of time.
"The first bidding process was January 9thand then the next one was the
19th and then on to the 29th. I began to suspectthe process was taking over
the results."
Kane said part of the group's objective was totry to preserve the status of
another airline in Shannon. When it appeared thisobjective was going to be
satisfied, Kane's consortium decided to withdraw.
Apart from Aeroflot, the other interests involvedin Kane's bid were partly
local and partly US-based. It is understood thatAeroflot is no longer
involved in either of the current bids.
Kane said the offer was for a "nominalamount" because that is all
he felt the airline was worth. As theairline's fleet was leased and its
equipment and landing slots in Gatwick wereto return to the parent company,
the consortium estimated that an investment ofe10 million would have been
required to sustain operations for a year, Kanesaid. Last week, Ryanair
announced that it was setting up a service fromShannon to Brussels, a route
which had previously been served by Virgin ExpressIreland.