172@29@17@241!~!172@29@0@53!~!|news|world|virgin-australia-to-axe-one-third-of-workforce-focus-on-short-haul-under-bain-capital-5646341.html!~!news|moneycontrol|com!~!|controller|infinite_scroll_article.php!~!is_mobile=false
Moneycontrol
Subscribe to PRO at just Rs.33 per month. Use code SUPERPRO
you are here: HomeNewsWorld
Last Updated : Aug 05, 2020 09:11 AM IST | Source: Reuters

Virgin Australia to axe one third of workforce, focus on short haul under Bain Capital

Virgin said on Wednesday the 3,000 jobs would go as the carrier offloads its fleets of Boeing 777s, Airbus SE A330s and ATR turboprops, as well as low-cost brand Tigerair Australia and its A320s.

Reuters
Virgin Australia
Virgin Australia

Virgin Australia Holdings Ltd plans to cut a third of its workforce as part of an overhaul to focus on being a short-haul Boeing Co 737 operator under prospective new owner Bain Capital.

Virgin said on Wednesday the 3,000 jobs would go as the carrier offloads its fleets of Boeing 777s, Airbus SE A330s and ATR turboprops, as well as low-cost brand Tigerair Australia and its A320s.

"Our initial focus will be on investing in the core Virgin Australia domestic and short-haul international operation alongside our 10-million-member strong Velocity Frequent Flyer programme, continuing to offer an extensive network of destinations, a domestic lounge network and value for money for customers," Chief Executive Paul Scurrah said in a statement.

Close

Virgin's board selected Bain as the winning bidder in late June of an auction that followed the airline's entry into voluntary administration in April.

Creditors, who are owed nearly A$7 billion ($5 billion), are due to vote on the sale by early next month. Unsecured bondholders have said they will propose an alternative debt-to-equity swap, which would also be put to a vote at the meeting.

A deal would need the approval of at least 50% of creditors by both value and number. Employees rank as the largest creditors by number at around 9,000, followed by around 6,000 bondholders.

The coronavirus pandemic was the final straw for Australia's second biggest airline, which had been unprofitable for seven consecutive years.

Larger rival Qantas Airways Ltd has also announced plans to cut at least 20% of its workforce due to the decline in demand caused by the pandemic and associated travel restrictions.

Scurrah said under Bain's ownership Virgin would have a strong balance sheet worth of an investment-grade rating, which it had lacked before entering administration.

Bain said it was backing Scurrah to remain in his role in the future.
First Published on Aug 5, 2020 08:45 am
Sections