Virgin Australia Holdings on Tuesday (April 21) succumbed to third-party led restructuring that could lead to a sale, making Australia's second-biggest airline the Asia-Pacific region's biggest victim of the coronavirus crisis gripping the industry.
Libby Hogan reports.
Virgin Australia has become Asia's biggest victim of the air travel industry's ongoing crisis.
The country's second-biggest airline had reported an annual loss for seven straight years, even before authorities around the globe began restricting movement.
It still managed to secure a third of Australia's domestic market before calling in administrators with a debt of over $3 billion U.S. dollars.
But after the current crisis grew worse, Australian officials rejected a plea for an $800 million U.S. dollar loan.
Now the airline's succumbed to restructuring that could lead to it being sold and the company has gone under 'administration' - Australia's closest thing to Chapter 11 bankruptcy.
CEO Paul Scurrah called it a necessary decision.
(SOUNDBITE) (English) VIRGIN AUSTRALIA CHIEF EXECUTIVE OFFICER, PAUL SCURRAH, SAYING: "This is not just something that is hurting Virgin Australia.
We know it's hurting the industry globally and is the worst aviation crisis we have ever seen in our history.
We're not immune to that.
Our board made a very courageous decision last night to put the company into voluntary administration and do so quickly, with the intent of working with our administrator Deloitte to come through and be as strong as we possibly can on the other side of this crisis." More than 90% of Virgin's shares are controlled by a group of investors including Singapore Airlines, Etihad Airways, Chinese conglomerate HNA Group and Richard Branson's Virgin Group.
The airline is continuing to fly a skeletion schedule for now.
The company's Deloitte administrator says the aim is to complete a sale within a few months.
The pandemic has forced Australia's second-largest domestic air carrier into voluntary administration, after the government refuses..