Virgin Australia owes $4.4 billion to creditors based on initial review: administrator

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Virgin Australia owes $4.4 billion to creditors based on initial review: administrator

 

FILE PHOTO: A Virgin Australia Airlines plane takes off from Kingsford Smith International Airport in Sydney, Australia, March 18, 2020. REUTERS/Loren Elliott

 

SYDNEY (Reuters) - Virgin Australia Holdings Ltd owes A$6.9 billion ($4.39 billion) to more than 10,000 creditors based on an initial review, according to an affidavit from one of the company's administrators.

 

Virgin on Tuesday succumbed to third-party led restructuring that could lead to a sale, making Australia's second-biggest airline the Asia-Pacific region's biggest victim of the coronavirus crisis gripping the industry.

 

The figure owed to creditors includes around A$2.3 billion of secured debt, A$2 billion of unsecured bonds, A$1.9 billion of aircraft leases, A$450 million owed to employees, A$167 million to trade creditors and A$71 million to landlords, said the affidavit from administrator Vaughan Strawbridge posted on the website of his firm Deloitte.

 

(Reporting by Jamie Freed; Editing by Himani Sarkar)

 

-- © Copyright Reuters 2020-04-24

 

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[PJPom]

Sad but inevitable ending for Virgin, if you cannot make a profit and contribute to Australia after all these years you deserve to fail. The comments that Qantas will totally dominate domestic travel are true and no doubt fares will increase for full service but don’t forget they also own Jetstar. Qantas will be able to make a vast profit simply by upping full service fares and increasing Jetstar discount fares at the same time, time to buy more Qantas shares. I miss Ansett, the best domestic airline Australia ever had...

[Andrew65]

2 hours ago, PJPom said:

Sad but inevitable ending for Virgin, if you cannot make a profit and contribute to Australia after all these years you deserve to fail. The comments that Qantas will totally dominate domestic travel are true and no doubt fares will increase for full service but don’t forget they also own Jetstar. Qantas will be able to make a vast profit simply by upping full service fares and increasing Jetstar discount fares at the same time, time to buy more Qantas shares. I miss Ansett, the best domestic airline Australia ever had...

True. But it's worth remembering that the airline business is one of the hardest industries there is to make a success of. One of the reasons I think that Richard Branson was quite admired by many, in the States especially.

[DoctorG]

Virgin was reportedly $5b in debt before the virus hit. Once COVID restrictions hit they had no chance of recovery.

They owe me $600 that I expect never to get.

[marko kok prong]

Maybe Branson can sell his famous pickle company and save it,or dress up as an air hostess in fishnet stockings again,or sell Knacker island or all 3.

[Sir Swagman]

Quote from Dixon, then head of Qantas, was ‘Jetstar doesn’t have to be a low cost airline, people just have to think it is’. 

[ukrules]

So they were already drowning in debt, hard luck I guess.

 

It was quite interesting to see this Branson character demanding that BA should not get any kind of government subsidy and be allowed to fail if it hit hard times. That would benefit him of course, he changed his opinion on bailouts very quickly recently.

 

This moron will be back with his fake 'space tourist' flights which barely make it past the stratosphere (not in space) before we know it.

 

 

[Mick501]

Guess it's good bye to my 200k or so FF points.  

[Yme]

There's no guarantee that Qantas will survive this in any format similar to before. Flights will be less frequent and much more expensive, similar to deregulation days. The days of everyone being able to (afford to) fly are over, not just in Australia, but everywhere. 



 

[sammieuk1]

This was on F/B  Poor sod. Down to his last private island, spaceship and 4 billion pounds!

 

 

 

 

[thaibeachlovers]

15 hours ago, Andrew65 said:

True. But it's worth remembering that the airline business is one of the hardest industries there is to make a success of. One of the reasons I think that Richard Branson was quite admired by many, in the States especially.

Having unfortunately had to use his revolting trains in the UK I have zero admiration for him. Quite the opposite in fact.

[torturedsole]

It's a good day to not be a Virgin Australia creditor.  

[simple1]

12 hours ago, Mick501 said:

Guess it's good bye to my 200k or so FF points.  

FF's are profitable business. most likely some group will keep the program in-place with new owners of Virgin assets. 

 

i guess the Australian taxpayer will have to fund the $450 million owing to employees.

Edited April 24, 2020 by simple1

[thaibeachlovers]

10 hours ago, Yme said:

There's no guarantee that Qantas will survive this in any format similar to before. Flights will be less frequent and much more expensive, similar to deregulation days. The days of everyone being able to (afford to) fly are over, not just in Australia, but everywhere. 



 

Good job too, IMO. Mass air travel is a pestilence on the planet, destroying once beautiful places in the rush of greed for the flashpacker $. Get back to 70s level.

Hopefully trains will get better and cheaper to compensate.

[3NUMBAS]

he s  moving into boat cruises and spaceships to mars