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Virgin Australia’s private equity owner Bain Capital has quietly increased the airline’s valuation in advance of its likely relisting on the ASX
The AFR reports the business’ management team was issued a total of 2 million shares, valued at $2.10 each, more than double the value of the previously offered equity.
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It comes after the business released a statement last month claiming it would “seek advice” on a “potential future IPO” but added that no final decision had been made.
The group also insisted it would retain a “significant shareholding” if Virgin were to become a public company again.
Bain Capital partner Mike Murphy said, “In the coming months, we will consider how best to position Virgin Australia for continued growth and long-term prosperity.
“Prior to covid [sic], Virgin Australia had a proud history as a public company. While there is currently no set timetable, at some point in the future, if any IPO does happen, Bain Capital would welcome public market investors joining us as shareholders in what is a great Australian company.
“Bain Capital has made a long-term commitment to support Virgin Australia’s growth and sustainability. It is Bain Capital’s current intention to retain a significant shareholding in a future IPO of Virgin Australia.
“Bain Capital will ensure these preliminary deliberations are not a distraction for Virgin Australia management, who can remain 100% focused on their roles.”
Later in January, Virgin told staff it generated $2.5 billion in revenue during the first half of the financial year.
Chief executive Jayne Hrdlicka said in a note that the business expects a profit margin of “roughly 5 per cent”.
“This is the first time in many years that Virgin has made a profit,” Hrdlicka wrote. “The results reflect the progress we have made in rebuilding the financial resilience that is so important to Virgin Australia’s long-term success.”
Virgin also separately announced a corporate reshuffle that will see ex-Macquarie Bank chairman Peter Warne join its board of directors along with former Goldman Sachs executive Pippa Downes.
