US equity giant to buy bankrupt Virgin Australia airlines

US private equity giant Bain Capital has agreed to buy bankrupt airline Virgin Australia, administrator Deloitte revealed on Friday.

The news comes after rival bidder Cyrus Capital Partners withdrew its offer citing a lack of engagement with the seller, reports Xinhua news agency.

Deloitte confirmed in a statement that it had entered into a sale and implementation deed with Bain Capital, which, subject to approvals including a vote by creditors in August, will result in the sale and recapitalization of Virgin.

“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,” joint administrator Vaughan Strawbridge said.

According to Deloitte, the transaction will see the retention of thousands of jobs as well as honouring all employee entitlements and passenger travel credits and frequent flyer points.

Virgin went into voluntary administration in April setting off the eight-week sale process.

While the global travel industry has been decimated by COVID-19, those facilitating the sale said that interest in the airline showed a recovery was possible.

“We have certainly been heartened by the levels of interest shown by parties, in spite of the prevailing COVID-induced market conditions,” Strawbridge said.