Bain Capital prepares second proposal for Virgin Australia

The US alternative asset manager is among four shortlisted bidders vying to take over the carrier

Australia's second largest airline, Virgin Australia, collapsed in April after the coronavirus crimped demand for travel. Reuters  

Bain Capital is preparing a second-round proposal to become the owner and operator of Virgin Australia Holdings, the US alternative asset manager said on Sunday.

Mike Murphy, its Sydney-based managing director, is leading the team bidding for Virgin Australia, which entered voluntary administration last month. Bain Capital is being advised by KordaMentha and is supported by Jayne Hrdlicka, the former chief executive of budget carrier Jetstar.

“We have the strongest capital base of any of the bidders,” Mr Murphy said in an emailed statement. “We know aviation isn’t going to return to normal any time soon, but Bain Capital is here for the long haul with deep funding to navigate these difficult times.”

Bain is among four shortlisted bidders vying for Virgin Australia, which collapsed in April overwhelmed by about A$6.5 billion ($4.2 bn/Dh15.6bn) in debt. The carrier’s problems were amplified by years of losses and a severe revenue shortfall from coronavirus-linked travel cancellations.

US private equity firm Indigo Partners said it would like a local partner for its bid. The other two shortlisted bidders are BGH Capital and Cyrus Capital Partners, the Australian Financial Review reported, citing unidentified sources.

Brookfield Asset Management is in discussions with administrator Deloitte over rejoining the bidding for the airline after withdrawing from consideration, sources said on Friday.

Deloitte, which has not identified the shortlisted parties, said it plans to work with them as it seeks binding offers by mid-June.

Bain Capital’s deal team includes 15 Australian professionals, global leaders from private equity and credit businesses, and specialists in aviation, retail and consumer sectors, the statement said.