You could also look at it the other way, and that is, this is the second Capital raising in 5 years totalling $600m. Virgin has been bleeding red ink for years. JB's game change hasn't actually changed anything yet, VAH is still losing tons of money. His saving grace is that he has shareholders with deep pockets, and he only has to keep 3 of them happy, all of whom have a vested interest in VA's survival.
Q was surviving with it's appalling number of destinations internationally as it was (albeit propped up by domestic). Now that it has access to the best international feed on the planet through EK, I doubt that AJ is too concerned about cash injections to VAH, in fact I bet he's laughing his tits off.
JB made the statement last year that he reckoned V had more free cash than Q and could sustain a fare war longer. Not sure how that has worked out.
The only positive for V is that the big shareholders now need Virgin to stay around because they will not be getting much traffic from the Qantas domestic feed, so SQ EY in particular will be happy to fund reasonable losses for some time to ensure they get access to the V domestic traffic. At the end of the day it is now about the bottom line of EY, SQ and NZ. VAH's profit is largely irrelevant, and i suggest we are unlikely to ever see one going forward as any significant surpluses are likely to be shifted offshore to more tax friendly environments.
Last edited by 6100; 15th Nov 2013 at 03:54.