Virgin Blue To Topple The Fox-Lew Bid For Ansett?
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The new owner of Ansett mk2 would not be responsible for any past workers entitlements - that is the responsibility of the administrator,unless some deal is being done with the agreement with past employees.The new owner of the business will be able to offer new conditions to whoever he wants.
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Virgin seeks details for Ansett bid
From AAP
19nov01
VIRGIN Blue says it will make a formal bid for Ansett when it looks at the failed airline's books.
But Virgin Blue's commercial head David Huttner would not be more specific on the timing.
Any bid could be made in conjunction with transport logistics giant the Lang Corporation.
Mr Huttner said: "We will put in a formal bid when we get access to information but we haven't cited exactly when.
"We hope to do so soon and we are in discussions with parties such as the Lang Corporation who might make that possible."
Mr Huttner accused Ansett's administrator and millionaire businessmen Lindsay Fox and Solomon Lew of using the excuse of timing to push the Fox-Lew bid for the airline.
"The administrator and Lew-Fox are trying to set the agenda and put a gun to the head of a lot of people on timing," he told ABC radio.
"But once again, if they were so interested in the timing they would open up the data room to us so we could make an effective bid that would be in the interest of their creditors."
Virgin Blue and Lang Corporation have met with the federal government to discuss preliminary plans to make a joint bid for Ansett, with Lang Corp to acquire Ansett terminals and infrastructure.
"Right now it's at a very preliminary stage," Mr Huttner said.
"Obviously we've been kind of shut out of the whole process by the administrator, they've set up a preferred deal with Fox-Lew.
"We've suggested that may not be in the interest of most of the creditors, certainly only a few creditors are being well looked after and a lot of other people are not getting clear information in our view.
"We are putting together a proposed possibility in conjunction with the Lang Corporation but whether or not it will go ahead is yet to be seen."
From AAP
19nov01
VIRGIN Blue says it will make a formal bid for Ansett when it looks at the failed airline's books.
But Virgin Blue's commercial head David Huttner would not be more specific on the timing.
Any bid could be made in conjunction with transport logistics giant the Lang Corporation.
Mr Huttner said: "We will put in a formal bid when we get access to information but we haven't cited exactly when.
"We hope to do so soon and we are in discussions with parties such as the Lang Corporation who might make that possible."
Mr Huttner accused Ansett's administrator and millionaire businessmen Lindsay Fox and Solomon Lew of using the excuse of timing to push the Fox-Lew bid for the airline.
"The administrator and Lew-Fox are trying to set the agenda and put a gun to the head of a lot of people on timing," he told ABC radio.
"But once again, if they were so interested in the timing they would open up the data room to us so we could make an effective bid that would be in the interest of their creditors."
Virgin Blue and Lang Corporation have met with the federal government to discuss preliminary plans to make a joint bid for Ansett, with Lang Corp to acquire Ansett terminals and infrastructure.
"Right now it's at a very preliminary stage," Mr Huttner said.
"Obviously we've been kind of shut out of the whole process by the administrator, they've set up a preferred deal with Fox-Lew.
"We've suggested that may not be in the interest of most of the creditors, certainly only a few creditors are being well looked after and a lot of other people are not getting clear information in our view.
"We are putting together a proposed possibility in conjunction with the Lang Corporation but whether or not it will go ahead is yet to be seen."
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Poor old AN, the possibility of another fat trucking magnate picking it up must send a chill down the spines of the few workers that will get picked up. Some of his views remind me of another fat transport magnate, R.I.H. ( rot in hell ) 
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BUSINESS
THURSDAY, 22 NOVEMBER 2001
B U S I N E S S S T O R Y
Virgin and Lang said ready to bid for Ansett
22 November 2001
SYDNEY (Reuters): Speculation about the future of collapsed airline Ansett Australia has intensified with media reports that Richard Branson's Virgin Blue Airlines and logistics group Lang Corp may announce a formal bid as early as today.
Ansett collapsed in September after it was put into voluntary administration by former parent Air New Zealand.
A Virgin-Lang deal to buy some Ansett assets would potentially restore the domestic aviation market, which is dominated by flag carrier Qantas Airways, to a duopoly.
Lang chairman Chris Corrigan was locked in talks on Wednesday with Virgin Blue's chief executive Brett Godfrey and his deputy Rob Sherrard to finalise financial aspects of the proposal, the Australian Financial Review newspaper reported today.
"We think it will far surpass anything anyone else has bid," the AFR reported Mr Sherrard as saying.
Ansett administrators have asked for federal financial backing for a takeover bid by Melbourne businessmen Solomon Lew and Lindsay Fox but analysts expect the recently re-elected conservative government to give it the cold shoulder.
Prime Minister John Howard has said that the only thing the government had guaranteed was the entitlements of Ansett's 16,000 workers, funded by a special $A10 ($NZ12.72) tax on domestic air tickets.
Canberra was believed to have given positive signals to Virgin Blue and Lang executives, the AFR said.
The Lang deal could be a two-way street for Virgin, which is looking to generate funds for Branson's mobile phone ventures.
One year-old discount carrier Virgin Blue conceded on Sunday that it was not set on retaining majority Virgin control and would consider selling a 51 percent stake to a cornerstone investor, although it said the sale of up to 49 percent in a public float was more likely.
Virgin Blue is currently in talks with around a dozen groups on its future after appointing Goldman Sachs in October to advise on funding options as it considers a 2002 listing on the Australian Stock Exchange.
Branson tore up a mock $A250 million cheque in front of reporters in September after rejecting a buyout offer from Air New Zealand's Ansett Australia.
Qantas has since tightened its grip on the domestic industry, laying claim to 85 percent of the market, leaving Virgin Blue to divide up the remainder with a skeleton Ansett service.
THURSDAY, 22 NOVEMBER 2001
B U S I N E S S S T O R Y
Virgin and Lang said ready to bid for Ansett
22 November 2001
SYDNEY (Reuters): Speculation about the future of collapsed airline Ansett Australia has intensified with media reports that Richard Branson's Virgin Blue Airlines and logistics group Lang Corp may announce a formal bid as early as today.
Ansett collapsed in September after it was put into voluntary administration by former parent Air New Zealand.
A Virgin-Lang deal to buy some Ansett assets would potentially restore the domestic aviation market, which is dominated by flag carrier Qantas Airways, to a duopoly.
Lang chairman Chris Corrigan was locked in talks on Wednesday with Virgin Blue's chief executive Brett Godfrey and his deputy Rob Sherrard to finalise financial aspects of the proposal, the Australian Financial Review newspaper reported today.
"We think it will far surpass anything anyone else has bid," the AFR reported Mr Sherrard as saying.
Ansett administrators have asked for federal financial backing for a takeover bid by Melbourne businessmen Solomon Lew and Lindsay Fox but analysts expect the recently re-elected conservative government to give it the cold shoulder.
Prime Minister John Howard has said that the only thing the government had guaranteed was the entitlements of Ansett's 16,000 workers, funded by a special $A10 ($NZ12.72) tax on domestic air tickets.
Canberra was believed to have given positive signals to Virgin Blue and Lang executives, the AFR said.
The Lang deal could be a two-way street for Virgin, which is looking to generate funds for Branson's mobile phone ventures.
One year-old discount carrier Virgin Blue conceded on Sunday that it was not set on retaining majority Virgin control and would consider selling a 51 percent stake to a cornerstone investor, although it said the sale of up to 49 percent in a public float was more likely.
Virgin Blue is currently in talks with around a dozen groups on its future after appointing Goldman Sachs in October to advise on funding options as it considers a 2002 listing on the Australian Stock Exchange.
Branson tore up a mock $A250 million cheque in front of reporters in September after rejecting a buyout offer from Air New Zealand's Ansett Australia.
Qantas has since tightened its grip on the domestic industry, laying claim to 85 percent of the market, leaving Virgin Blue to divide up the remainder with a skeleton Ansett service.
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I. W. S.
Don't knock Mr. Fox, he's not a bad bloke.
Whatever happens with AN it will be a poor show if the 195mil. disappears into the pocket of big business though. THAT BELONGS TO REDUNDANT AN STAFF.
Don't knock Mr. Fox, he's not a bad bloke.
Whatever happens with AN it will be a poor show if the 195mil. disappears into the pocket of big business though. THAT BELONGS TO REDUNDANT AN STAFF.
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Takeover not ticket for Virgin
BY STEVE CREEDY and RICHARD GLUYAS
23nov01
VIRGIN Blue is not interested in taking over the Ansett business and any bid it makes will be to secure assets for its own expansion.
But even that plan remained in limbo yesterday as the Brisbane-based carrier downplayed reports it was close to a deal with Chris Corrigan's Lang Corp.
Lang is one of about a dozen potential investors talking to Virgin about a cornerstone investment as the low-cost carrier heads towards a public float next year.
Virgin is considering a deal with Lang which would allow it to acquire Ansett's terminals, some staff and other facilities.
It sees terminal space as particularly important to future expansion and has said it would be against the national interest to see it locked up by Melbourne millionaires Solomon Lew and Lindsay Fox.
But it was not looking to run Ansett and had yet to finalise a deal, Virgin commercial head David Huttner said yesterday.
"We're in discussions, we're talking to a variety of parties and clearly Lang is one of them," Mr Huttner said.
"We're trying to put together a deal with Lang that would address some of these issues but it's certainly not the only thing we have going."
Ansett's administrators, Mark Mentha and Mark Korda of Andersen, have played down the prospect of an 11th-hour rival bid to the preferred Fox-Lew syndicate.
A source close to the administrators said Virgin Blue had not visited the Ansett data room or signed a confidentiality agreement.
"The data room has now been closed down and the asset has been sold," he said.
A motion supporting the Fox-Lew bid had also been unanimously carried at last Thursday's meeting of the Ansett creditors committee. The Fox-Lew syndicate regards Virgin Blue as a spoiler, interested only in picking up Ansett assets in a liquidation of the airline.
Virgin Blue and Fox-Lew traded potshots last weekend, with the discount airline's chief executive, Brett Godfrey, saying a revived Ansett would result in overcapacity.
But a statement by Mr Fox and Mr Lew said a two-airline system comprising Qantas and Virgin Blue would be "a disastrous outcome for competition".
They said Australia would effectively have a monopoly at the leisure end of the market with Virgin Blue, and with Qantas's dominance of the business segment and the major trunk routes.
BY STEVE CREEDY and RICHARD GLUYAS
23nov01
VIRGIN Blue is not interested in taking over the Ansett business and any bid it makes will be to secure assets for its own expansion.
But even that plan remained in limbo yesterday as the Brisbane-based carrier downplayed reports it was close to a deal with Chris Corrigan's Lang Corp.
Lang is one of about a dozen potential investors talking to Virgin about a cornerstone investment as the low-cost carrier heads towards a public float next year.
Virgin is considering a deal with Lang which would allow it to acquire Ansett's terminals, some staff and other facilities.
It sees terminal space as particularly important to future expansion and has said it would be against the national interest to see it locked up by Melbourne millionaires Solomon Lew and Lindsay Fox.
But it was not looking to run Ansett and had yet to finalise a deal, Virgin commercial head David Huttner said yesterday.
"We're in discussions, we're talking to a variety of parties and clearly Lang is one of them," Mr Huttner said.
"We're trying to put together a deal with Lang that would address some of these issues but it's certainly not the only thing we have going."
Ansett's administrators, Mark Mentha and Mark Korda of Andersen, have played down the prospect of an 11th-hour rival bid to the preferred Fox-Lew syndicate.
A source close to the administrators said Virgin Blue had not visited the Ansett data room or signed a confidentiality agreement.
"The data room has now been closed down and the asset has been sold," he said.
A motion supporting the Fox-Lew bid had also been unanimously carried at last Thursday's meeting of the Ansett creditors committee. The Fox-Lew syndicate regards Virgin Blue as a spoiler, interested only in picking up Ansett assets in a liquidation of the airline.
Virgin Blue and Fox-Lew traded potshots last weekend, with the discount airline's chief executive, Brett Godfrey, saying a revived Ansett would result in overcapacity.
But a statement by Mr Fox and Mr Lew said a two-airline system comprising Qantas and Virgin Blue would be "a disastrous outcome for competition".
They said Australia would effectively have a monopoly at the leisure end of the market with Virgin Blue, and with Qantas's dominance of the business segment and the major trunk routes.
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Brett Godfrey of Virgin Blue was just interviewed
on the ABC 7.30 report, says without terminals
VB will be limited to 25 aircraft next year, with
terminal access would be 32 planes with 3500
employee's.
Wirraway
on the ABC 7.30 report, says without terminals
VB will be limited to 25 aircraft next year, with
terminal access would be 32 planes with 3500
employee's.
Wirraway
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Creditors 'unhappy' with Fox-Lew bid
Nov 24
Stephen Long
Virgin Blue and Lang Corporation had been approached by "major creditors" who were unhappy with the union-backed bid for Ansett by Mr Lindsay Fox and Mr Solomon Lew, a Virgin spokesman claimed on Friday, as Lang Corp chairman Mr Chris Corrigan and Virgin Blue executives continued to try to complete an alternative proposal.
But senior officials from Ansett unions, whose members are priority creditors of Ansett, dismissed the belated attempt for the airline by Lang Corp and Virgin Blue and affirmed their support for the Fox-Lew proposal which has already been endorsed by the committee of creditors.
"I am totally unenthusiastic about their proposal," the Australian Workers Union's national secretary, Mr Bill Shorten, said on Friday.
"Without a doubt, in my opinion, Corrigan and Virgin Blue have absolutely no interest in saving jobs in maintenance."
A senior union official said: "They haven't got the numbers. But I say that with a big 'if' because I don't know what they're offering."
The secretary of the Transport Workers Union, Mr John Allan, said he had not had any advice on the Virgin-Lang bid and could not comment, but said unions would not tolerate a situation in which a bidder came in "to pick up the assets and none of the employees". Mr Fox and Mr Lew this weekend will ask Ansett staff to make expressions of interest in taking up a position in a "New Ansett" under their control. They have established a website for job applications.
Virgin Blue's head of commercial, Mr David Huttner, said on Friday: "Certain major creditors have approached us to say they are not convinced that the Fox-Lew deal is in their interests and that they are concerned at the way the process is being driven."
The best hope for the proposed Lang Corporation-Virgin Blue venture seems to lie in trying to split the creditors by offering a better return in the dollar to unsecured creditors, rather than trying to split the unions by holding out the prospect of more membership and coverage deals to some unions.
The TWU already has exclusive coverage of ground staff at Virgin Blue and the Australian Licensed Aircraft Engineers Association, employed by the contractor Jet-Care, performs maintenance work for Virgin Blue.
It is not yet known whether existing agreements apply or where these unions would stand on the venture.
Nov 24
Stephen Long
Virgin Blue and Lang Corporation had been approached by "major creditors" who were unhappy with the union-backed bid for Ansett by Mr Lindsay Fox and Mr Solomon Lew, a Virgin spokesman claimed on Friday, as Lang Corp chairman Mr Chris Corrigan and Virgin Blue executives continued to try to complete an alternative proposal.
But senior officials from Ansett unions, whose members are priority creditors of Ansett, dismissed the belated attempt for the airline by Lang Corp and Virgin Blue and affirmed their support for the Fox-Lew proposal which has already been endorsed by the committee of creditors.
"I am totally unenthusiastic about their proposal," the Australian Workers Union's national secretary, Mr Bill Shorten, said on Friday.
"Without a doubt, in my opinion, Corrigan and Virgin Blue have absolutely no interest in saving jobs in maintenance."
A senior union official said: "They haven't got the numbers. But I say that with a big 'if' because I don't know what they're offering."
The secretary of the Transport Workers Union, Mr John Allan, said he had not had any advice on the Virgin-Lang bid and could not comment, but said unions would not tolerate a situation in which a bidder came in "to pick up the assets and none of the employees". Mr Fox and Mr Lew this weekend will ask Ansett staff to make expressions of interest in taking up a position in a "New Ansett" under their control. They have established a website for job applications.
Virgin Blue's head of commercial, Mr David Huttner, said on Friday: "Certain major creditors have approached us to say they are not convinced that the Fox-Lew deal is in their interests and that they are concerned at the way the process is being driven."
The best hope for the proposed Lang Corporation-Virgin Blue venture seems to lie in trying to split the creditors by offering a better return in the dollar to unsecured creditors, rather than trying to split the unions by holding out the prospect of more membership and coverage deals to some unions.
The TWU already has exclusive coverage of ground staff at Virgin Blue and the Australian Licensed Aircraft Engineers Association, employed by the contractor Jet-Care, performs maintenance work for Virgin Blue.
It is not yet known whether existing agreements apply or where these unions would stand on the venture.
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Lang Corp to buy Virgin Blue
From AAP
25nov01
TRANSPORT logistics giant Lang Corporation has agreed to buy more than 50 per cent of Virgin Blue, making the airline a majority Australian company, Lang Corp managing director Chris Corrigan said today.
However the deal was dependent on Lang Corp and Virgin Blue buying failed airline Ansett, Mr Corrigan said.
"It would lead to Virgin Blue becoming an Australian airline," he told Channel Nine.
"It's certainly more than 50 per cent."
He said he was meeting with Ansett's administrators tomorrow and added the Lang-Virgin bid would require no government assistance.
"We're prepared to inject $300 million into Virgin in order to make it a much larger competitor with Qantas today and see it offering the low fares and the opportunities to Australians to travel," Mr Corrigan said.
He reiterated the deal would only go ahead if Virgin Blue was successful in buying Ansett.
"There's not much point in expanding Virgin if it's going to not be able to get access to key assets that would allow it to expand rapidly," he said.
From AAP
25nov01
TRANSPORT logistics giant Lang Corporation has agreed to buy more than 50 per cent of Virgin Blue, making the airline a majority Australian company, Lang Corp managing director Chris Corrigan said today.
However the deal was dependent on Lang Corp and Virgin Blue buying failed airline Ansett, Mr Corrigan said.
"It would lead to Virgin Blue becoming an Australian airline," he told Channel Nine.
"It's certainly more than 50 per cent."
He said he was meeting with Ansett's administrators tomorrow and added the Lang-Virgin bid would require no government assistance.
"We're prepared to inject $300 million into Virgin in order to make it a much larger competitor with Qantas today and see it offering the low fares and the opportunities to Australians to travel," Mr Corrigan said.
He reiterated the deal would only go ahead if Virgin Blue was successful in buying Ansett.
"There's not much point in expanding Virgin if it's going to not be able to get access to key assets that would allow it to expand rapidly," he said.
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As has been said in other posts, Virgin has a good chance of being marginalised when Ansett starts seriously.
It is very significant that Corrigan will not touch it without the terminals etc.
It is doubtful whether Virgin could survive in its current form with 25 aircraft, current cash flows and limited airside facilities etc.
Despite reports to the contrary, the creditors have agreed to the Fox Lew deal. (The final vote was unanimous.)
Everyone needs to remember that the largest group of creditors are the ex staff, and they will ratify the proposal at the full meeting of creditors.
A very, very different outcome would have resulted had Corrigan and Virgin presented this deal earlier in the piece.
It is very significant that Corrigan will not touch it without the terminals etc.
It is doubtful whether Virgin could survive in its current form with 25 aircraft, current cash flows and limited airside facilities etc.
Despite reports to the contrary, the creditors have agreed to the Fox Lew deal. (The final vote was unanimous.)
Everyone needs to remember that the largest group of creditors are the ex staff, and they will ratify the proposal at the full meeting of creditors.
A very, very different outcome would have resulted had Corrigan and Virgin presented this deal earlier in the piece.
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Well to the best of my knowledge, and any information here in Australia, it is NOT yet a done deal...... 
Had a Labor Government been elected (God forbid) THEN the Fox/Lew bid would have been automatic.
Lang Corp will have much more influence with the Liberal Government......
Had a Labor Government been elected (God forbid) THEN the Fox/Lew bid would have been automatic.
Lang Corp will have much more influence with the Liberal Government......
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ABC News Net:
Virgin Blue could become Australian-owned
Transport logistics giant Lang Corporation says it has reached an agreement overnight enabling it to acquire Richard Branson's majority interest in Virgin Blue.
The deal would see Virgin Blue become an Australian airline.
The overnight deal could see Lang acquire 51 per cent or more of Virgin Blue with Richard Branson prepared to sell his controlling interest.
Speaking on Channel Nine this morning Lang chief executive Chris Corrigan said the deal would involve a significant cash injection to Virgin Blue to enable it to grow quicker than it has in the past.
"We're prepared to inject $300 million into Virgin in order to make it a much larger competitor with Qantas today," he said.
Mr Corrigan says Virgin Blue has a unique and exciting business model.
"We're very attracted to that, we think there is a great opportunity much larger operator in the Australian market," he said.
But he says the airline needs the finance to buy access to terminals and aircraft to increase its presence in the domestic aviation industry.
Virgin Blue could become Australian-owned
Transport logistics giant Lang Corporation says it has reached an agreement overnight enabling it to acquire Richard Branson's majority interest in Virgin Blue.
The deal would see Virgin Blue become an Australian airline.
The overnight deal could see Lang acquire 51 per cent or more of Virgin Blue with Richard Branson prepared to sell his controlling interest.
Speaking on Channel Nine this morning Lang chief executive Chris Corrigan said the deal would involve a significant cash injection to Virgin Blue to enable it to grow quicker than it has in the past.
"We're prepared to inject $300 million into Virgin in order to make it a much larger competitor with Qantas today," he said.
Mr Corrigan says Virgin Blue has a unique and exciting business model.
"We're very attracted to that, we think there is a great opportunity much larger operator in the Australian market," he said.
But he says the airline needs the finance to buy access to terminals and aircraft to increase its presence in the domestic aviation industry.
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Lame
Just seen on SKY news the deal is conditional
on Lang Corp getting the terminals, i.e.
Ansett being liqidated, can't see it happening unless the creditors reject
the Lew/Fox deal, getting more cents back
in the dollar than going ahead with the current deal.
Wirraway
Just seen on SKY news the deal is conditional
on Lang Corp getting the terminals, i.e.
Ansett being liqidated, can't see it happening unless the creditors reject
the Lew/Fox deal, getting more cents back
in the dollar than going ahead with the current deal.
Wirraway
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Wirraway,
Okay, thank you.....
So you could read it as Lang Corp/Virgin Blue, trying to put pressure on the Government and the creditors to accept their bid, rather than the Fox/Lew one......
I am sure Lang Corp would be on better terms with the Liberal Government than Fox/Lew would , but wonder which way the creditors will go..........
Best regards,
"lame"
Okay, thank you.....
So you could read it as Lang Corp/Virgin Blue, trying to put pressure on the Government and the creditors to accept their bid, rather than the Fox/Lew one......
I am sure Lang Corp would be on better terms with the Liberal Government than Fox/Lew would
, but wonder which way the creditors will go.......... Best regards,
"lame"
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Lame
As well as which way the creditors will
go is will the Fed govt give Fox/Lew
part of the Commonwealth travel contract
that Qantas currently have, which they
have said is conditional on their deal
going ahead, me thinks the future of
Aus commercial aviation is in the hands
of the cabinet this coming week.
Wirraway
As well as which way the creditors will
go is will the Fed govt give Fox/Lew
part of the Commonwealth travel contract
that Qantas currently have, which they
have said is conditional on their deal
going ahead, me thinks the future of
Aus commercial aviation is in the hands
of the cabinet this coming week.
Wirraway
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Wirraway,
Yes I agree.....
Had there been a Labor Government now (God forbid), there is no doubt about it, Fox/Lew and their Labor/ACTU mates would have it already....
However with the Liberals in power still, I think my money would be on Lang Corp...
Best regards,
"lame"
Yes I agree.....
Had there been a Labor Government now (God forbid), there is no doubt about it, Fox/Lew and their Labor/ACTU mates would have it already....
However with the Liberals in power still, I think my money would be on Lang Corp...
Best regards,
"lame"
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The following is what was actually said this morning on TV.........
(QUOTE)
November 25, 2001
VIRGIN BLUE ON THE MARKET
25 November 2001
Ali Moore
"Virgin Blue now is the second airline in Australia and it's got a very unique and exciting business model..."
Last week, Virgin Blue's Brett Godfrey confirmed the airline was on the "market", with Richard Branson willing to sell up to 51 per cent to a new investor.
Mr Godfrey also revealed that the airline was working with Lang Corporation, in eyeing part or ALL of "Ansett".
This morning we have further developments. Chris Corrigan of Lang Corporation talks to Ali Moore.
BUSINESS SUNDAY TRANCRIPT: NOVEMBER 25TH. 2001
CHRIS CORRIGAN, LANG CORPORATION talking to ALI MOORE
REPORTER: Good Morning Mr. Corrigan, thanks for talking to us. What are you doing with Virgin Blue?
CHRIS CORRIGAN, LANG CORPORATION: Well overnight we reached an agreement with Richard Branson's interests for which would lead to Lang Corp taking a majority interest in Virgin Blue and injecting significant capital, up to 300-million dollars, into that airline to allow it to grow much more quickly than it's been able to do to date.
REPORTER: A majority interest, what is that, 51 per cent?
CORRIGAN: Yes, 51 per cent or more.
REPORTER: How much more, 60 per cent?
CORRIGAN: Well it would depend on the way things worked out in terms of the financing but it's - it would lead to Virgin Blue becoming an Australian airline.
REPORTER: Could it be as high as 60 per cent though?
CORRIGAN: Could be.
REPORTER: Maybe even higher, 65, 70?
CORRIGAN: Well I don't think there's much point in guessing about those matters but it's certainly more than 50 per cent, yes.
REPORTER: The 300-million that you're putting in to fund the expansion, the purchase of Ansett, how much are you paying for the equity stake?
CORRIGAN: That's a confidential matter at this stage. We'd reveal that obviously when the deal was complete.
REPORTER: Well you'd have to say if Branson was offered 250-million back in August, for the whole of Virgin by Air New Zealand when times were a lot better than they are now, you'd be looking at around another 100-million?
CORRIGAN: I think you've got understand that Virgin Blue now is the second airline in Australia and it's got a very unique and exciting business model and so we're very attracted to that; we think there's a great opportunity for it to become a much larger operator in the Australian market and to offer a very significant difference to what, in terms of passenger offering than what Qantas is offering today. So it is a great opportunity so long as they can get the finance in order to buy the access to terminals and obviously to aircraft.
REPORTER: At the same time it has a very small market share at the moment and certainly the aviation industry worldwide is not what you would consider to be an up and up industry, is 100-million around the ballpark that you're prepared to pay for a significant stake?
CORRIGAN: What I've said is we've prepared to inject 300-million dollars into Virgin in order to make it a much larger competitor with Qantas today and to see it offering the low fares and the opportunities to Australians to travel, to all Australians, we think that's a tremendous opportunity to expand its range of activities within the Australian market.
REPORTER: The controlling stake that you will take, all of it is dependent on the purchase of Ansett?
CORRIGAN: Yes it is. We think there's not much point in expanding Virgin if it's going to not be able to get access to key assets that would allow it to expand rapidly.
REPORTER: So what is the Virgin Lang Corp. plan for Ansett?
CORRIGAN: Well the Virgin Lang Corp. plan is to expand Virgin so we're interested in some of the Ansett assets that would allow Virgin to become a much larger, so much larger and viable business than it is even today.
REPORTER: The terminals? How much other infrastructure?
CORRIGAN: The terminals, maintenance facilities, a range of things that would allow Virgin to go on expanding more rapidly than it's already doing.
REPORTER: How many Ansett staff would you take on?
CORRIGAN: We could probably take on in the order of one-and-a-half thousand, something of that order because you've got to understand Virgin already is up and viable, has a large market share, it's growing and is training people to fill up the new aircraft that it has on order.
REPORTER: And you're talking of one class operation as Virgin operates now?
CORRIGAN: Yes this is a very modern and a very successful business model. It's been tried elsewhere in the world and it would offer a very significant point of difference as I say, to the Qantas two class, full service airline.
REPORTER: Have you spoken to the Administrators?
CORRIGAN: We have a meeting with them tomorrow morning and we'll be outlining our plans to them.
REPORTER: Haven't you left your run a bit late, I mean the Government is even saying now that all the outstanding issues with the Fox Lew bid will likely be resolved next week and certainly the Administrators are saying that Fox Lew is virtually a done deal?
CORRIGAN: Well time will tell on that. Certainly the Fox Lew proposal's on the table, we don't know precisely what it is, it's pretty clear that it does involve significant Government assistance and whether or not that assistance will be forthcoming on a scale that will get them off the ground we're yet to see. Certainly the Virgin Blue, the Lang Virgin Blue proposal requires no Government assistance whatsoever.
REPORTER: Well how do you convince creditors, and let's take first of all the biggest group of creditors, the Unions, you're talking about 1500 staff, Fox Lew are talking about 4-thousand, how do you get past that hurdle?
CORRIGAN: Oh well we may not convince them on the face but you have to ask yourself, one has to ask whether an airline with 4-thousand people starting up in this market, is going to be a successful model, particularly in a two class environment, so the Unions and the creditors have to ask themselves those sort of pretty important questions. I mean, I'm travelling quite regularly myself, I don't have any trouble getting a seat, there isn't a crisis in the airline industry, this is effectively starting a new airline and that's going to be extremely difficult in all the circumstances you outlined.
REPORTER: Will creditors get more than 15 cents in the dollar under your proposal?
CORRIGAN: Oh that's something for the Administrators to determine, we can only put forward the proposal that we've got on the table for them.
REPORTER: Well how are you going to convince them, how are you going to sell this, I mean, let's start with the image problem most people do think Chris Corrigan and Lang Corp. and they think dogs, they think the wharf?
CORRIGAN: Look, we've just signed a new Enterprise Agreement with our Waterfront Workers which involves new productivity, higher wages, we've got a very, very stable and productive workplace, so we've had a tremendous success with the waterfront and...
REPORTER: So are the Unions on side with this?
CORRIGAN: Oh.
REPORTER: Have you talked to them?
CORRIGAN: No we haven't talked to them because Virgin's an existing business, we're talking about investing in an existing business that has a very productive and exciting workforce. We're not starting an airline from scratch.
REPORTER: But I guess the point still remains, how do you convince the creditors?
CORRIGAN: Well we're yet to see whether or not the only existing other proposal that's on the table in fact is a viable proposal, so we may not ...doing the best we can which is that Virgin is a very exciting, differentiated product, it's the model airline from it and we're prepared to expand that quite rapidly to provide competition and low airfares for all Australians on all the routes... now I think that's a great proposition rather than me-two (?) alternative.
REPORTER: Do you want to go international?
CORRIGAN: Virgin I think has announced today that they are interested in the Trans Tasman route. I think that's about as far as we'd be interested in going.
AM; No Ansett International that wouldn't interest you?
CORRIGAN: No it's not part of the plane.
AM; You say you don't want any Government help, is the 195-million the Government's lent turning that into a grant rather than a loan, is that a part of your plan, or that is irrelevant?
CORRIGAN: That's got to do with the Administrators. At the end of the day it's not anything that affects our plan.
REPORTER: You've already teemed up with Toll over your attempt to buy National Whale, do you see opportunities for synergies using Toll Holdings or perhaps other businesses to try and outsource some of the aircraft handling, some of the other ground operations?
CORRIGAN: This has got nothing to do with Toll. The Toll arrangements that we have are strictly to do with a bid for National Island Freight Corp.
REPORTER: Well alright, how do you rate your chances of success?
CORRIGAN: In the airline, I think it's an exciting model where we can only do the best, we only put forward the best we can and then I'm quite optimistic about it and very exciting about the prospect.
REPORTER: Alright Mr. Corrigan, thank you very much for joining us.
-end
(QUOTE)
November 25, 2001
VIRGIN BLUE ON THE MARKET
25 November 2001
Ali Moore
"Virgin Blue now is the second airline in Australia and it's got a very unique and exciting business model..."
Last week, Virgin Blue's Brett Godfrey confirmed the airline was on the "market", with Richard Branson willing to sell up to 51 per cent to a new investor.
Mr Godfrey also revealed that the airline was working with Lang Corporation, in eyeing part or ALL of "Ansett".
This morning we have further developments. Chris Corrigan of Lang Corporation talks to Ali Moore.
BUSINESS SUNDAY TRANCRIPT: NOVEMBER 25TH. 2001
CHRIS CORRIGAN, LANG CORPORATION talking to ALI MOORE
REPORTER: Good Morning Mr. Corrigan, thanks for talking to us. What are you doing with Virgin Blue?
CHRIS CORRIGAN, LANG CORPORATION: Well overnight we reached an agreement with Richard Branson's interests for which would lead to Lang Corp taking a majority interest in Virgin Blue and injecting significant capital, up to 300-million dollars, into that airline to allow it to grow much more quickly than it's been able to do to date.
REPORTER: A majority interest, what is that, 51 per cent?
CORRIGAN: Yes, 51 per cent or more.
REPORTER: How much more, 60 per cent?
CORRIGAN: Well it would depend on the way things worked out in terms of the financing but it's - it would lead to Virgin Blue becoming an Australian airline.
REPORTER: Could it be as high as 60 per cent though?
CORRIGAN: Could be.
REPORTER: Maybe even higher, 65, 70?
CORRIGAN: Well I don't think there's much point in guessing about those matters but it's certainly more than 50 per cent, yes.
REPORTER: The 300-million that you're putting in to fund the expansion, the purchase of Ansett, how much are you paying for the equity stake?
CORRIGAN: That's a confidential matter at this stage. We'd reveal that obviously when the deal was complete.
REPORTER: Well you'd have to say if Branson was offered 250-million back in August, for the whole of Virgin by Air New Zealand when times were a lot better than they are now, you'd be looking at around another 100-million?
CORRIGAN: I think you've got understand that Virgin Blue now is the second airline in Australia and it's got a very unique and exciting business model and so we're very attracted to that; we think there's a great opportunity for it to become a much larger operator in the Australian market and to offer a very significant difference to what, in terms of passenger offering than what Qantas is offering today. So it is a great opportunity so long as they can get the finance in order to buy the access to terminals and obviously to aircraft.
REPORTER: At the same time it has a very small market share at the moment and certainly the aviation industry worldwide is not what you would consider to be an up and up industry, is 100-million around the ballpark that you're prepared to pay for a significant stake?
CORRIGAN: What I've said is we've prepared to inject 300-million dollars into Virgin in order to make it a much larger competitor with Qantas today and to see it offering the low fares and the opportunities to Australians to travel, to all Australians, we think that's a tremendous opportunity to expand its range of activities within the Australian market.
REPORTER: The controlling stake that you will take, all of it is dependent on the purchase of Ansett?
CORRIGAN: Yes it is. We think there's not much point in expanding Virgin if it's going to not be able to get access to key assets that would allow it to expand rapidly.
REPORTER: So what is the Virgin Lang Corp. plan for Ansett?
CORRIGAN: Well the Virgin Lang Corp. plan is to expand Virgin so we're interested in some of the Ansett assets that would allow Virgin to become a much larger, so much larger and viable business than it is even today.
REPORTER: The terminals? How much other infrastructure?
CORRIGAN: The terminals, maintenance facilities, a range of things that would allow Virgin to go on expanding more rapidly than it's already doing.
REPORTER: How many Ansett staff would you take on?
CORRIGAN: We could probably take on in the order of one-and-a-half thousand, something of that order because you've got to understand Virgin already is up and viable, has a large market share, it's growing and is training people to fill up the new aircraft that it has on order.
REPORTER: And you're talking of one class operation as Virgin operates now?
CORRIGAN: Yes this is a very modern and a very successful business model. It's been tried elsewhere in the world and it would offer a very significant point of difference as I say, to the Qantas two class, full service airline.
REPORTER: Have you spoken to the Administrators?
CORRIGAN: We have a meeting with them tomorrow morning and we'll be outlining our plans to them.
REPORTER: Haven't you left your run a bit late, I mean the Government is even saying now that all the outstanding issues with the Fox Lew bid will likely be resolved next week and certainly the Administrators are saying that Fox Lew is virtually a done deal?
CORRIGAN: Well time will tell on that. Certainly the Fox Lew proposal's on the table, we don't know precisely what it is, it's pretty clear that it does involve significant Government assistance and whether or not that assistance will be forthcoming on a scale that will get them off the ground we're yet to see. Certainly the Virgin Blue, the Lang Virgin Blue proposal requires no Government assistance whatsoever.
REPORTER: Well how do you convince creditors, and let's take first of all the biggest group of creditors, the Unions, you're talking about 1500 staff, Fox Lew are talking about 4-thousand, how do you get past that hurdle?
CORRIGAN: Oh well we may not convince them on the face but you have to ask yourself, one has to ask whether an airline with 4-thousand people starting up in this market, is going to be a successful model, particularly in a two class environment, so the Unions and the creditors have to ask themselves those sort of pretty important questions. I mean, I'm travelling quite regularly myself, I don't have any trouble getting a seat, there isn't a crisis in the airline industry, this is effectively starting a new airline and that's going to be extremely difficult in all the circumstances you outlined.
REPORTER: Will creditors get more than 15 cents in the dollar under your proposal?
CORRIGAN: Oh that's something for the Administrators to determine, we can only put forward the proposal that we've got on the table for them.
REPORTER: Well how are you going to convince them, how are you going to sell this, I mean, let's start with the image problem most people do think Chris Corrigan and Lang Corp. and they think dogs, they think the wharf?
CORRIGAN: Look, we've just signed a new Enterprise Agreement with our Waterfront Workers which involves new productivity, higher wages, we've got a very, very stable and productive workplace, so we've had a tremendous success with the waterfront and...
REPORTER: So are the Unions on side with this?
CORRIGAN: Oh.
REPORTER: Have you talked to them?
CORRIGAN: No we haven't talked to them because Virgin's an existing business, we're talking about investing in an existing business that has a very productive and exciting workforce. We're not starting an airline from scratch.
REPORTER: But I guess the point still remains, how do you convince the creditors?
CORRIGAN: Well we're yet to see whether or not the only existing other proposal that's on the table in fact is a viable proposal, so we may not ...doing the best we can which is that Virgin is a very exciting, differentiated product, it's the model airline from it and we're prepared to expand that quite rapidly to provide competition and low airfares for all Australians on all the routes... now I think that's a great proposition rather than me-two (?) alternative.
REPORTER: Do you want to go international?
CORRIGAN: Virgin I think has announced today that they are interested in the Trans Tasman route. I think that's about as far as we'd be interested in going.
AM; No Ansett International that wouldn't interest you?
CORRIGAN: No it's not part of the plane.
AM; You say you don't want any Government help, is the 195-million the Government's lent turning that into a grant rather than a loan, is that a part of your plan, or that is irrelevant?
CORRIGAN: That's got to do with the Administrators. At the end of the day it's not anything that affects our plan.
REPORTER: You've already teemed up with Toll over your attempt to buy National Whale, do you see opportunities for synergies using Toll Holdings or perhaps other businesses to try and outsource some of the aircraft handling, some of the other ground operations?
CORRIGAN: This has got nothing to do with Toll. The Toll arrangements that we have are strictly to do with a bid for National Island Freight Corp.
REPORTER: Well alright, how do you rate your chances of success?
CORRIGAN: In the airline, I think it's an exciting model where we can only do the best, we only put forward the best we can and then I'm quite optimistic about it and very exciting about the prospect.
REPORTER: Alright Mr. Corrigan, thank you very much for joining us.
-end