Getting Virgin Australia back on track
In November 2020 Deloitte Restructuring Services partners and joint Virgin Australia Voluntary Administrators, John Greig, Richard Hughes and Sal Algeri, announced the completion of the sale of the Virgin Australia Group, with the shares and the entire business of the airline being transferred to Bain Capital.
Bain Capital took custody of the airline after one of the most challenging administrations in Australia’s corporate history, not least as a business, an employer of thousands of people and a key contributor to national and state economies. Triggered by the COVID-19 pandemic, it was a process like no other in Australian corporate history.
This complex appointment was further challenged by the fact that the process was undertaken and completed during Australia’s pandemic shutdown.
Virgin Australia was successfully restructured and recapitalised through the voluntary administration preserving 5,000 plus jobs and ensuring ongoing viability and a competitive Australian aviation industry.
The key success factors included:
- The management of key stakeholders in Australia and overseas, which included Virgin Australia’s management and staff, unions, equipment lessors and financiers, service providers to the business, the Federal Government, Velocity Frequent Flyer members and the airline’s new owners, Bain Capital
- An accelerated global sale process
- The implementation of an operating model restructure plan
- An innovative approach to the administration process and the sale structure.
The successful conclusion of the administration was a tribute to the assistance given to the Deloitte team by Virgin Australia’s management and staff, who kept the airline flying throughout; the unions who supported them and Virgin’s service providers. All worked together to ensure that Australia’s aviation sector would be vibrant and competitive in the post-COVID.