Key points
- Virgin entered voluntary administration during the first year of the pandemic
- Bain Capital bought the airline later that year for $3.5 billion
- The private investment firm is reportedly in talks to float the airline on the ASX
ASX travel companies could face a new competitor on the market by 2023. Could Virgin Australia be looking to list on the ASX?
Virgin formerly traded on the ASX with the ticker VHA under the name Virgin Australia Holdings Ltd.
The airline entered voluntary administration in April 2020 amid COVID-19 travel restrictions. Bain Capital bought the airline in October 2020 for $3.5 billion.
When might Virgin become an ASX travel share once more?
Virgin Australia is looking at 2023 as a potential date for an initial public offering (IPO), according to The Australian. Sources told the publication that Bain Capital would assess a possible float midway through this year with a view to listing in 2023.
Bain Capital is a private equity firm headquartered in Boston, Massachusetts in the US.
No investment banks have been appointed to manage an ASX float but discussions are said to have taken place with advisors, according to the article. By 2023, the firm hopes Omicron fears will have played out, sources said.
This is not the first time talk of an ASX relisting has emerged.
In December, Virgin managing director Jayne Hrlicka confirmed the airline had received approaches to list on the ASX. However, she hosed down the speculation.
In a note to employees cited by The Financial Review, Hrlicka said:
Bain regularly receives proposals like this and no decisions have been made in relation to any potential relisting or other activity.
If and when there is something to say about future capital structures of Virgin Australia, you will hear it from us.
Bain Capital under every scenario will be our strategic partners and our major shareholder for many years to come.
Former Virgin shareholders were left devastated when the airline went into administration in 2020. Motley Fool Australia reported at the time that shareholders received nothing but regret for their shares. A federal court ruled they would not receive shareholder compensation.
ASX travel shares have had a mixed 12 months. The Qantas Airways Limited (ASX: QAN) share price has climbed 2.4% in the past year, while Flight Centre Travel Group (ASX: FLT) shares have returned 9.5%.
Regional Express Holdings Ltd (ASX: REX) shares have descended 26%, while Webjet Ltd (ASX: WEB) shares have fallen 4.4%.
