Virgin Australia: Cyrus Capital Partners withdraws?!
Which leaves just Bain Capital – and the out of bounds bid by the bondholders left in the ring.
The Administrators of Virgin Australia had whittled down the potential purchasers, requesting final binding bids from Bain Capital and Cyrus Capital Partners. Those bids were submitted on Monday, with the intention that a final bid would be recommended to a meeting of creditors as soon as they had been evaluated.
A consortium of bondholders threw a bomb in after the deadline with an outliers proposal to take over the airline. As fara as we know – the administrators have considered and rejected this proposal, which strangely, favoured the bondholders.
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The reason Cyrus has withdrawn
From the statement, it looks like they are feeling like a jilted lover. Apparently, the administrators have not been returning their calls or emails. They even say that if the administrators ‘re-engage’ with them, they would re-activate their offer.
With the ‘withdrawal’ of Cyrus, it looks like the administrators are left with only one complying bid. Or this is just a ploy to attract attention, and they will re-activate their bid once the administrators talk to them?
Here is what Cyrus has said in its statement about the administrator Deloitte.
‘On the morning of 22 June 2020, Cyrus presented to the administrators of Virgin Australia Holdings an offer to acquire the airline, its regional business and the frequent flyer program Velocity, in accordance with the administrators’ procedures. However, since then, the administrators have not returned calls, emails, or meaningfully engaged with Cyrus to progress its offer.’
On Thursday morning Cyrus submitted some additions to the bid which outlined ‘value improvements’ in an attempt to clinch the deals. But obviously no one phoned them back to acknowledge these additions.
Leave that door ajar!
Cyrus chief investment officer Stephen Freidheim hasn’t closed the door entirely. Although they have picked up their bat and ball, they haven’t quite turned homeward.
‘Cyrus firmly believes that the Australian aviation industry has a bright future and would be willing to re-instate our offer if the administrators agree to re-engage in good faith, productive discussions with a view to concluding a transaction that will benefit all key stakeholders — employees, customers, Velocity members and bondholders.’
Well, I did predict this would happen soon, and it looks like they left it until the beginning of 2023 to make the announcements.
Sit back, relax. Looks like this sideshow could be entertaining.
Is this the behaviour of a pre-pubescent teenager in the corporate world? When did corporate politics turn into a young adults novel?