Virgin Australia administrator to shortlist two bidders early next week
May 29, 2020
By Jamie Freed and Scott Murdoch
SYDNEY/HONG KONG (Reuters) – The administrator of Virgin Australia Holdings <VAH.AX> expects to shortlist two preferred bidders early next week after parties on Friday confirmed non-binding indicative proposals to acquire the airline.
Brookfield Asset Management, which pulled out of the first bidding round and was not on the initial shortlist of four, submitted a proposal on Friday with the encouragement of unions and administrator Deloitte, a source with knowledge of the matter told Reuters on condition of anonymity.
Brookfield and Deloitte both declined to comment on that development.
The four on the initial shortlist included BGH Capital, Bain Capital, Indigo Partners and Cyrus Capital Partners, Reuters had previously reported.
A Bain spokesman confirmed that the private equity group had lodged its bid by the afternoon deadline.
A Deloitte statement said that the next phase for the two parties on the final shortlist would include further engagement with stakeholders and aircraft financiers as they seek agreements on future terms before binding bids are received.
Binding offers are due on June 12.
The Australian Financial Review (AFR) on Friday said, without citing sources, that the bidders are likely to place an enterprise value of between A$3.5 billion ($2.3 billion) and A$4 billion on the airline.
Deloitte said that such figures were “just speculation” and the value would not be known until binding offers were required.
Virgin owed nearly A$7 billion to creditors when it entered voluntary administration last month.
(Reporting by Jamie Freed and Paulina Duran in Sydney and Scott Murdoch in Hong Kong; Editing by Clarence Fernandez, Himani Sarkar and David Goodman)