- Multiple reports say troubled airline Virgin Australia is set to enter voluntary administration.
- The airline, which has taken a massive hit due to coronavirus travel restrictions, had been unable to secure financial aid from the federal government.
- It is believed Deloitte Australia will be appointed as administrators.
- Visit Business Insider Australia’s homepage for more stories.
Update 21/4/2019: Virgin Australia has officially entered administration.
Virgin Australia, saddled with tremendous debt and slammed by COVID-19 restrictions, is set to go into voluntary administration, according to multiple reports.
A report on Monday afternoon in the Australian Financial Review said the company’s board was ready to “throw in the towel” after several efforts to secure a financial lifeline from the federal government collapsed.
It’s reported the federal government told the troubled airline there would be no further assistance. Duelling claims from New South Wales and Victoria to offer their own rescue packages in exchange for company headquarters were seemingly not enough.
Reports in the AFR, Sydney Morning Herald and The Guardian suggest Deloitte is in line to serve as administrator, having already been appointed to manage the company’s possible restructuring effort through the coronavirus pandemic.
In March, Virgin confirmed it had been exploring “a range of options” to survive the coronavirus crisis, which has grounded the vast majority of the world’s planes and taken a sledgehammer to the aviation industry, including seeking a $1.4 billion in financial support from the Australian government.
The Sydney Morning Herald reports several private equity firms are already “sniffing around” Virgin looking to buy the business out of administration.
Virgin directly employs around 10,000 people and supports 6000 jobs indirectly.
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