20 buyers now circling Virgin Australia
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I can’t help but feel that Carla (she loves being called that by the way - she got stuck into the union boys for its use on here) will just finish the job that the mail room boy started.
So for my comrades at Virgin - pray to whatever god you choose that it’s not led by her.
So for my comrades at Virgin - pray to whatever god you choose that it’s not led by her.
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I can’t help but feel that Carla (she loves being called that by the way - she got stuck into the union boys for its use on here) will just finish the job that the mail room boy started.
So for my comrades at Virgin - pray to whatever god you choose that it’s not led by her.
So for my comrades at Virgin - pray to whatever god you choose that it’s not led by her.
The Borghetti experiment going up against his old company was a complete and utter failure.
Can only imagine her trying the same and achieving equally disastrous results!
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Employees giving their respective unions 9000 proxy votes should give them some say in it.
When a poll is conducted, a resolution is passed if both:
- more than half the number of creditors who are voting (in person or by proxy) vote in favour of the resolution
- those creditors who are owed more than half of the total debt owed to creditors at the meeting vote in favour of the resolution.
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What 'Mr Icarus', said..... Number and Value!!!!
ex Mr Bullwinkle-
- that then, yields $450 million in 'Weighted' Value.
The 'Chairperson' has...- and 'it', has all been mentioned time and again.......... on this journey.
Go Well....
Rgds
S28
This is referred to as a ‘majority in number and value’. If a majority in both number and value is not reached under a poll (often referred to as a deadlock), the chairperson has a casting vote.
hopefully 9000 votes will go against Bain
The 'Chairperson' has...- and 'it', has all been mentioned time and again.......... on this journey.
Go Well....
Rgds
S28
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The administrator will do what's best for the creditors and $450 million v $6.8 billion in debt just won't work in a voting sense, so can't see how staff creditors can meaningfully affect an outcome here.
The administrator will do what's best for the creditors and $450 million v $6.8 billion in debt just won't work in a voting sense, so can't see how staff creditors can meaningfully affect an outcome here.
The trap for the administrators is to screw the debt holders and then wind up in court justifying your actions. Similar to what happened here and ended up with ANZ settling out of court: https://www.abc.net.au/news/2016-05-...s-sale/7460634
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Sure this is a chat forum. But claiming to make a sound decision regarding the bankruptcy of your airline based on a rumored CEO/chairmwoman v the other bidders empty chair is a fair indication of the stress we are all under right now.
The idea to rebrand the airline also appears more emotional than logical. Any agreements (including 10,000,000 Velocity members, thousands who have purchased yet to be honored VA tickets and all it’s employees past, present and future entitlements) are between the concerned party and VA. The legal cost of rewriting those agreements and the data transfer that would involve would far outweigh any perceived benefit. And I can’t think of any airline that successfully emerged from administration under a new name. What would be the point? The buyer gets an AOC for the bargain basement price of a few billion plus the entitlements of 10,000 employees? The primary reason for the purchase of Virgin is for the brand. It might appear toxic for the employees on the inside (just as Apple is for its employees or football teams are to their players) but for the consumer it’s identifiable and marketable.
You don’t buy a “good airline but a bad business” to then change its name.
Last edited by Progress Wanchai; 3rd Jun 2020 at 14:04.
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ex the AFR 05/06/20: What Virgin Mark II will look like.......
Link here: https://www.afr.com/companies/transp...0200604-p54zw7
Extract here (bolding):
Rgds
S28- BE
Extract here (bolding):
What Virgin Mark II will look like
What Virgin Mark II will look like
Jemima Whyte Senior reporter
Updated Jun 5, 2020 – 5.39pm, first published at 5.00pm
We finally have a picture of what Virgin Australia Mark II might look like. It's union-friendly, retains at least two-thirds of its domestic fleet and is firmly focused on the leisure market.
Or at least, that's the slightly surprising-looking future based on the details leaking from the process of finding a new owner for the collapsed airline being run by administrator Deloitte.
Union leaders, including the National Secretary of the Transport Workers Union, Michael Kaine, are spending a lot of time with Virgin bidders. AAP
The amount of time New York hedge fund Cyrus Capital and private equity group Bain Capital are spending with various unions, which represent most of Virgin's 9000 employees, is an indication of how much these bidders want the unions on side.
Binding offers from Cyrus and Bain, named this week as the final contenders for Virgin, aren't due until June 22, and creditors will meet in mid-August to approve a sale or put the company in liquidation.
The US funds will spend the next few weeks combing through the details, meeting with stakeholders and, of course, gauging how quickly they can get their money back running an airline in a constantly changing environment.
There are at least two obvious wild cards at play before any deal is done: the role of the bond holders and the quickly shifting domestic aviation environment. That's assuming a deal is done at all, and there are plenty of parties who say they are unsure about the prospect of a sale.
What looked ambitious just a few weeks ago – getting more than 40 planes in the air by the end of July – is now possible. In fact, Qantas said this week it expected to be back to 40 per cent of its pre-COVID-19 domestic capacity by July.
Qantas' full plan includes ramping up domestic capacity from 5 per cent to 15 per cent by the end of June – the equivalent of putting on about 300 more weekly return flights. It's a way of helping the airline meet demand and defray the costs of owning a fleet and paying staff.
Industry rule of thumb – though these vary wildly – is the lease cost on a mid-life narrowbody aircraft would be about $250,000 a month.
'It's really just guesswork'
"Scope of operations", it was said, was key in selecting the final two bidders, with 80 planes the rough level that Virgin is expected to be able to effectively compete with Qantas. Where that leaves the final dollar number – something the bond holders will watch closely – isn't clear.
Deloitte picked the two final bidders apparently based on their commitments to keeping about 80 or so of Virgin's 130 domestic planes in the fleet and plans to quickly get them flying again, subject to demand.
"It's really just guesswork at this stage," says aviation expert Peter Harbison, executive chairman of CAPA Centre for Aviation, when asked about the environment in which a resurrected Virgin will operate.
Recreating Virgin's international network will be challenging, he says: "You'd want to keep away from that for at least a year."
So what about the domestic corporate market? That's looking tough as well, he says, noting that traditionally the business segment has been both profitable and strategically important for Virgin.
A commitment to keeping the planes – assuming the bidders stick to it – is interesting, because many saw the administration as an opportunity to reset the cost base, of which leases were one part.
What looked ambitious just a few weeks ago – getting more than 40 planes in the air by the end of July – is now possible.
"It [the airline] has got to have lower costs, that doesn't mean having fewer flights ... and if you can come out of administration and only lose 15 per cent of jobs, you are looking pretty good as well," Mr Harbison said.
While the unions are getting plenty of attention, and the employee vote is important in getting a deal approved, the bond holders seem oddly quiet.
For weeks, the bond holders have been banding together, appointing Farraday and Corrs Chambers Westgarth as their advisers.
Representing as much as $1.8 billion of the total $6.8 billion owed, the bond holders are significant in numbers. One estimate is about 5000 owners, made up mainly of people holding the ASX-listed notes. Of those retail notes, most are Australian.
The creditors will be asked to approve any sale based on both a majority of numbers and value, and if there's a split, the administrator has the casting vote. On numbers and value, the bond holders represent an important creditor group.
There's been talk of needing a pay-out as others say they are unlikely to get anything, and even whispers of debt to equity swaps and alternative offers. How an improved domestic operating environment feeds into that remains to be seen.
Crystal-ball gazing for the new Virgin (which will only have that name if the bidder strikes a deal with Richard Branson's Virgin Group) is complicated.
Mr Harbison says it will be interesting to see how prime-time slots at Sydney Airport are awarded, if the new Virgin gives some up, and whether that will be overseen by the competition regulator.
But he's clear on one part of Virgin's future. "Two months ago this airline was owned by four international airlines. The primary goal was to deliver traffic to international airlines," he says.
"Making a profit wasn't top of the list. That will change."
Jemima Whyte writes on business, specialising in companies, capital markets and innovation. Jemima has reported on business for The Australian Financial Review for more than 13 years. Email Jemima at [email protected]
Updated Jun 5, 2020 – 5.39pm, first published at 5.00pm
We finally have a picture of what Virgin Australia Mark II might look like. It's union-friendly, retains at least two-thirds of its domestic fleet and is firmly focused on the leisure market.
Or at least, that's the slightly surprising-looking future based on the details leaking from the process of finding a new owner for the collapsed airline being run by administrator Deloitte.
Union leaders, including the National Secretary of the Transport Workers Union, Michael Kaine, are spending a lot of time with Virgin bidders. AAP
The amount of time New York hedge fund Cyrus Capital and private equity group Bain Capital are spending with various unions, which represent most of Virgin's 9000 employees, is an indication of how much these bidders want the unions on side.
Binding offers from Cyrus and Bain, named this week as the final contenders for Virgin, aren't due until June 22, and creditors will meet in mid-August to approve a sale or put the company in liquidation.
The US funds will spend the next few weeks combing through the details, meeting with stakeholders and, of course, gauging how quickly they can get their money back running an airline in a constantly changing environment.
There are at least two obvious wild cards at play before any deal is done: the role of the bond holders and the quickly shifting domestic aviation environment. That's assuming a deal is done at all, and there are plenty of parties who say they are unsure about the prospect of a sale.
What looked ambitious just a few weeks ago – getting more than 40 planes in the air by the end of July – is now possible. In fact, Qantas said this week it expected to be back to 40 per cent of its pre-COVID-19 domestic capacity by July.
Qantas' full plan includes ramping up domestic capacity from 5 per cent to 15 per cent by the end of June – the equivalent of putting on about 300 more weekly return flights. It's a way of helping the airline meet demand and defray the costs of owning a fleet and paying staff.
Industry rule of thumb – though these vary wildly – is the lease cost on a mid-life narrowbody aircraft would be about $250,000 a month.
'It's really just guesswork'
"Scope of operations", it was said, was key in selecting the final two bidders, with 80 planes the rough level that Virgin is expected to be able to effectively compete with Qantas. Where that leaves the final dollar number – something the bond holders will watch closely – isn't clear.
Deloitte picked the two final bidders apparently based on their commitments to keeping about 80 or so of Virgin's 130 domestic planes in the fleet and plans to quickly get them flying again, subject to demand.
"It's really just guesswork at this stage," says aviation expert Peter Harbison, executive chairman of CAPA Centre for Aviation, when asked about the environment in which a resurrected Virgin will operate.
Recreating Virgin's international network will be challenging, he says: "You'd want to keep away from that for at least a year."
So what about the domestic corporate market? That's looking tough as well, he says, noting that traditionally the business segment has been both profitable and strategically important for Virgin.
A commitment to keeping the planes – assuming the bidders stick to it – is interesting, because many saw the administration as an opportunity to reset the cost base, of which leases were one part.
What looked ambitious just a few weeks ago – getting more than 40 planes in the air by the end of July – is now possible.
"It [the airline] has got to have lower costs, that doesn't mean having fewer flights ... and if you can come out of administration and only lose 15 per cent of jobs, you are looking pretty good as well," Mr Harbison said.
While the unions are getting plenty of attention, and the employee vote is important in getting a deal approved, the bond holders seem oddly quiet.
For weeks, the bond holders have been banding together, appointing Farraday and Corrs Chambers Westgarth as their advisers.
Representing as much as $1.8 billion of the total $6.8 billion owed, the bond holders are significant in numbers. One estimate is about 5000 owners, made up mainly of people holding the ASX-listed notes. Of those retail notes, most are Australian.
The creditors will be asked to approve any sale based on both a majority of numbers and value, and if there's a split, the administrator has the casting vote. On numbers and value, the bond holders represent an important creditor group.
There's been talk of needing a pay-out as others say they are unlikely to get anything, and even whispers of debt to equity swaps and alternative offers. How an improved domestic operating environment feeds into that remains to be seen.
Related
Virgin bidders lay out planned job losses
So far, there has been no real action despite the endless discussions. Time is running out and any move, if one is to be made, must come soon.Crystal-ball gazing for the new Virgin (which will only have that name if the bidder strikes a deal with Richard Branson's Virgin Group) is complicated.
Mr Harbison says it will be interesting to see how prime-time slots at Sydney Airport are awarded, if the new Virgin gives some up, and whether that will be overseen by the competition regulator.
But he's clear on one part of Virgin's future. "Two months ago this airline was owned by four international airlines. The primary goal was to deliver traffic to international airlines," he says.
"Making a profit wasn't top of the list. That will change."
Jemima Whyte writes on business, specialising in companies, capital markets and innovation. Jemima has reported on business for The Australian Financial Review for more than 13 years. Email Jemima at [email protected]
S28- BE
The employees, by virtue of numbers, can block any proposed Deed of Company Arrangement. They are the only creditor grouping with that power. Don't think for a moment that the unions do not understand that. They will have a big say in terms of which way this swings. Why do you think BGH were handed their hat?
Pinnacle Airlines in the US. They emerged from Chapter 11 as Endeavour Air.
The brand would not be in the top 4 reasons for trying to resurrect VA leave alone being the primary reason. You only need to ask the question, 'Everything else being equal, if it wasn't called Virgin Australia would there be as much interest?'
Pinnacle Airlines in the US. They emerged from Chapter 11 as Endeavour Air.
The brand would not be in the top 4 reasons for trying to resurrect VA leave alone being the primary reason. You only need to ask the question, 'Everything else being equal, if it wasn't called Virgin Australia would there be as much interest?'
It could/will be called whatever they like.
The rest is academic.
the primary reasons for the purchase of Virgin are for the footprint it occupies. The slots. The terminals, the gates, the facilities. All barriers to entry into the Australian market for a new player.
It could/will be called whatever they like.
The rest is academic.
It could/will be called whatever they like.
The rest is academic.
You can apply a very simple little thought experiment; think of a criteria (AOC, terminal leases, Sydney slots, whatever), imagine it was absent, ask yourself whether you'd still be interested in buying the airline.
The employees, by virtue of numbers, can block any proposed Deed of Company Arrangement. They are the only creditor grouping with that power. Don't think for a moment that the unions do not understand that. They will have a big say in terms of which way this swings. Why do you think BGH were handed their hat?
My advise to any Virgin employee is not to put your faith in the union to secure the deal despite what they say because they can't force Bain or Cyrus to buy the airline if at the last minute they choose not to. The most devastating statement I heard during the whole Ansett debacle was Greg Combet on the news stating "There are no jobs to be saved at Ansett.".
Had a giggle today and was taken by surprise.
I was told KM was brought into the Bain bid because of the positive relationship it has with union secretaries and presidents.
KM is there to win sections of the union voting block. Not my opinion but from the horses mouth.
I was told KM was brought into the Bain bid because of the positive relationship it has with union secretaries and presidents.
KM is there to win sections of the union voting block. Not my opinion but from the horses mouth.