Virgin Australia will be sold to US-based equity firm Bain Capital after rival bidder Cyrus Capital pulled out of the race.
Administrators for the airline have confirmed a Sale and Implementation Deed had been signed with Bain.
The deal is expected to be completed in August.
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While some job losses are expected, administrator Vaughan Strawbridge confirmed the transaction “commits to the retention of thousands of jobs” and guarantees employees’ entitlements.
Bain has also backed the current management team led by CEO Paul Scurrah.
The news is also good for travellers which sees the agreement carry forward all travel credits and frequent flyer bookings.
Virgin Australia will also remain headquartered in Queensland after a deal with the State Government’s investment arm.
The Queensland Government had previously put $200 million on the table to keep the airline in the State.
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“This is an important milestone and a significant achievement,” Mr Strawbridge said.
“Bain Capital has presented a strong and compelling bid for the business that will secure the future of Australia’s second airline, thousands of employees and their families and ensure Australia continues to enjoy the benefits of a competitive aviation sector.”
Current shareholders are not expected to receive a cent from the sale, while it’s not clear how much, if anything will be returned to the airline’s creditors which are owed $6.8 billion.
The sale to Bain comes after rival Cyrus Capital withdrew its offer and delivered a scathing attack on administrators Deloitte.
Cyrus cited a “lack of engagement” for pulling its offer.
“The administrators have not returned calls, emails, or meaningfully engaged with Cyrus to progress its offer,” Cyrus’ founder and chief investment officer Stephen Freidheim said in a statement.
Mr Freidheim said they had no response from Deloitte, apart from an acknowledgement that its proposal had been received.
“I am disappointed that it has become necessary to withdraw our offer,” Mr Freidheim said.
Unions have acknowledged the sale, and say they look forward to urgent discussions on the future of Virgin’s workforce.
“We understand that the agreement provides 100% protection of employee entitlements but will result in the loss of jobs to some of Virgin Australia’s hardworking and skilled employees,” ACTU President Michele O’Neil said.
“What is needed now is for the Federal Government to play its part to secure a viable future for the aviation industry and its workers given yesterday’s announcement by Qantas and today’s developments with Virgin.”