20 buyers now circling Virgin Australia
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Terry McCrann in the past 20 years has never ever written one good thing about Virgin. He has a major conflict of interest (has QF shares fly's in the pointy end of the rat).
A carcass, a funny sick joke how nice of you when I'm trying to feed the family. If I ever meet him in person and after a very irate conversation I would conclude you are a crab.
A carcass, a funny sick joke how nice of you when I'm trying to feed the family. If I ever meet him in person and after a very irate conversation I would conclude you are a crab.
the dominant, financially strong and superbly structured and focused Qantas
His ‘House’ analogy doesn’t really make a lot of sense. In addition his understanding of Airline operating economics appears to be, shall we say, ‘limited’. For a start the current shareholders are getting zip, that’s a given. The judgement for the unsecured creditors is wether they think they can extract more value out of a total liquidation or, ultimately get more with some small % of their bonds and/or some sort of debt for equity arrangement if the operation continues. Another question given the current environment, is wether the so called ‘secured creditors’ have their exposure covered given that trying to liquidate 40 or so 737NGs may be problematic.
It's just an opinion piece.... Most people that are able to view the whole Virgin thing dispassionately would probably not find too much to argue about in that article.
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Which is why Indigo would have been a good investor, most certainly long term.
Canberra needs to remain firm on not lining these equity mobs with cash. He will lose my vote next election if he backs down on his strong stance against not funding Virgin and it’s problems. Read deep into the world of equity and where governments have been caught out dragged along in the mud. The fear articles have started to surface already. All orchestrated from Wall St.
Canberra needs to remain firm on not lining these equity mobs with cash. He will lose my vote next election if he backs down on his strong stance against not funding Virgin and it’s problems. Read deep into the world of equity and where governments have been caught out dragged along in the mud. The fear articles have started to surface already. All orchestrated from Wall St.
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Whatever you think of Terry's opinion, I believe he has nailed the "modus operandi" of private equity organisations - rip cash out of a very high cash flow business then re-float and sell.
You all seem to understand. The VC community always considers their EXIT strategy before they even think of investing. So that is the bit of their “business plan” that is already tightly scripted and organised in detail before anything else. What then happens is they look to constructing a “front end” that allows them to do their exit strategy. It’s all ass backwards compared to normal business planning.
We don’t know the exit strategy and neither does Deloittes. The VCs may already have buyers/investors lined up and will “flip” the airline in three to six months, making 500 million in the process and also making Deloittes look like idiots as well as sending bond holders suicidal. The request for government cash/ guarantees or special treatment is also common. The risk for government in doing that is the VCs walk away with half a billion when they execute their exit plan, leaving the taxpayer on the hook for billions.
Dont think for a moment that the VC’s won’t sell their grandmothers to do deals like this and will use every trick, dirty or not, to get what they want. I still have the scars, 20 years later, from having to deal with these creatures.
We don’t know the exit strategy and neither does Deloittes. The VCs may already have buyers/investors lined up and will “flip” the airline in three to six months, making 500 million in the process and also making Deloittes look like idiots as well as sending bond holders suicidal. The request for government cash/ guarantees or special treatment is also common. The risk for government in doing that is the VCs walk away with half a billion when they execute their exit plan, leaving the taxpayer on the hook for billions.
Dont think for a moment that the VC’s won’t sell their grandmothers to do deals like this and will use every trick, dirty or not, to get what they want. I still have the scars, 20 years later, from having to deal with these creatures.
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Anyone who picks up the rotting carcass that is VA isn't doing it to make people happy they are doing it to strip what flesh is left off the carcasses bones using whatever tactics they can dream up, the trick is to get everyone to think the opposite!
Big business only succeeds in being cunning!
I feel for the employees, they are pawns in this mess!
Big business only succeeds in being cunning!
I feel for the employees, they are pawns in this mess!
Last edited by machtuk; 14th Jun 2020 at 10:14.
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Agreed.
It’s sleazy, greedy, amoral behaviour with motivations more aligned to white-collar criminals than a community-focussed, consumer-oriented type of owner and manager with the national interest in mind that they purport to be.
I’m no socialist but I wish there were laws to stop this kind of capitalism.
It brings bile to my taste buds.
PG
It’s sleazy, greedy, amoral behaviour with motivations more aligned to white-collar criminals than a community-focussed, consumer-oriented type of owner and manager with the national interest in mind that they purport to be.
I’m no socialist but I wish there were laws to stop this kind of capitalism.
It brings bile to my taste buds.
PG
You all seem to understand. The VC community always considers their EXIT strategy before they even think of investing. So that is the bit of their “business plan” that is already tightly scripted and organised in detail before anything else. What then happens is they look to constructing a “front end” that allows them to do their exit strategy. It’s all ass backwards compared to normal business planning.
We don’t know the exit strategy and neither does Deloittes. The VCs may already have buyers/investors lined up and will “flip” the airline in three to six months, making 500 million in the process and also making Deloittes look like idiots as well as sending bond holders suicidal. The request for government cash/ guarantees or special treatment is also common. The risk for government in doing that is the VCs walk away with half a billion when they execute their exit plan, leaving the taxpayer on the hook for billions.
Dont think for a moment that the VC’s won’t sell their grandmothers to do deals like this and will use every trick, dirty or not, to get what they want. I still have the scars, 20 years later, from having to deal with these creatures.
We don’t know the exit strategy and neither does Deloittes. The VCs may already have buyers/investors lined up and will “flip” the airline in three to six months, making 500 million in the process and also making Deloittes look like idiots as well as sending bond holders suicidal. The request for government cash/ guarantees or special treatment is also common. The risk for government in doing that is the VCs walk away with half a billion when they execute their exit plan, leaving the taxpayer on the hook for billions.
Dont think for a moment that the VC’s won’t sell their grandmothers to do deals like this and will use every trick, dirty or not, to get what they want. I still have the scars, 20 years later, from having to deal with these creatures.
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Terry is spot on. Neither bidder is interested in the human side of Virgin. It is entity to make money out of. Strip and dispose. A well trod strategy. Tuff business not love.
https://www.smh.com.au/business/comp...13-p5529b.html
The Richard Branson-linked investment firm Cyrus Capital believes Virgin Australia could be profitable within three years after relaunching under its ownership as a smaller, simpler, mid-market airline operating a domestic and international network.
In the firm's first public comments about its interest in Virgin, Cyrus senior adviser Jonathan Peachey said the business had become "too complex" and "too corporate" as it morphed from the budget upstart Virgin Blue into a full-service airline competing head-to-head with Qantas.
Cyrus has a history of investing in airlines alongside Mr Branson's Virgin Group, which owned 10 per cent of Virgin Australia when it collapsed. It launched Virgin America together in 2005 and in February 2019 bought the British regional airline Flybe, which has since gone into administration.
Mr Peachey said Cyrus would re-start Virgin as a "hybrid" airline, with a competitively priced business class product alongside affordable leisure travel fares.
"The business... should sit below that very top tier of where Qantas plays so strongly in, and above and maybe overlapping slightly where Jetstar sits," he said.
"We don’t intended to take the business right the way down to the ultra-low cost space - we don’t think the market needs that with Jetstar’s presence."
Bain has said it would position Virgin somewhere between a low-cost and full-service airline, and also wants to work with Mr Branson to maintain the Virgin brand.
...
Mr Peachey said Cyrus was taking a "long-term view" and noted it remained a shareholder in Virgin America for 12 years, including after its NASDAQ listing, until its bought outright by Alaska Airlines.
With Cyrus still working on its final bid – due for submission to administrators Deloitte on June 22 – Mr Peachey said he could not comment on whether it would offer anything to Virgin's unsecured bondholders, who are owed $2 billion and growing anxious they will walk away with nothing.
Cyrus says it has around $US4 billion ($5.8 billion) of assets under management and a client base mostly made up of from university endowments, hospitals and charitable foundations.
The Richard Branson-linked investment firm Cyrus Capital believes Virgin Australia could be profitable within three years after relaunching under its ownership as a smaller, simpler, mid-market airline operating a domestic and international network.
In the firm's first public comments about its interest in Virgin, Cyrus senior adviser Jonathan Peachey said the business had become "too complex" and "too corporate" as it morphed from the budget upstart Virgin Blue into a full-service airline competing head-to-head with Qantas.
Cyrus has a history of investing in airlines alongside Mr Branson's Virgin Group, which owned 10 per cent of Virgin Australia when it collapsed. It launched Virgin America together in 2005 and in February 2019 bought the British regional airline Flybe, which has since gone into administration.
Mr Peachey said Cyrus would re-start Virgin as a "hybrid" airline, with a competitively priced business class product alongside affordable leisure travel fares.
"The business... should sit below that very top tier of where Qantas plays so strongly in, and above and maybe overlapping slightly where Jetstar sits," he said.
"We don’t intended to take the business right the way down to the ultra-low cost space - we don’t think the market needs that with Jetstar’s presence."
Bain has said it would position Virgin somewhere between a low-cost and full-service airline, and also wants to work with Mr Branson to maintain the Virgin brand.
...
Mr Peachey said Cyrus was taking a "long-term view" and noted it remained a shareholder in Virgin America for 12 years, including after its NASDAQ listing, until its bought outright by Alaska Airlines.
With Cyrus still working on its final bid – due for submission to administrators Deloitte on June 22 – Mr Peachey said he could not comment on whether it would offer anything to Virgin's unsecured bondholders, who are owed $2 billion and growing anxious they will walk away with nothing.
Cyrus says it has around $US4 billion ($5.8 billion) of assets under management and a client base mostly made up of from university endowments, hospitals and charitable foundations.
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Evertonian
It launched Virgin America together in 2005 and in February 2019 bought the British regional airline Flybe, which has since gone into administration.
