- Queensland’s new Treasurer, Cameron Dick, has announced plans for the State Government to bid for Virgin Australia (VAH)
- Virgin Australia collapsed last month with over $5 billion in debt, buckling under the travel restrictions caused by COVID-19
- In preparing its bid, the Queensland Government says it’s prepared to enter a deal with through either a stake in the airline, a loan or a guarantee
- The Government has already appointed the state-owned ‘Queensland Investment Corporation’ to oversee the bid
- Shares in Virgin Australia flatlined in mid-April at 8.6 cents each
Queensland’s new Treasurer, Cameron Dick, has announced plans for the State Government to bid for Virgin Australia (VAH).
Back in mid-April, Virgin Australia entered voluntary administration — buckling under travel restrictions brought on by COVID-19. The demise, carrying over $5 billion in debt, represented Australia’s largest airline failure since Ansett in 2002.
However, a surprise development now shows the Queensland Government has plans to bid for the airline.
Heading “Project Maroon,” Treasurer Cameron Dick — just two days into the role — has already appointed an investment company; the state-owned ‘Queensland Investment Corporation’ (QIC).
“We have been very clear,” Cameron said on Wednesday. “Two sustainable national airlines are critical to Australia’s economy.”
The Treasurer says the pursuit of Virgin can take form in either a “[…] direct equity stake, a loan, guarantee or other financial incentives”.
The Palaszczuk Government has intentions for a revitalised Virgin to keep its headquarters in Brisbane, where 1200 workers reside.
“We have an opportunity to retain not only head office and crew staff in Queensland, but also to grow jobs in the repairs, maintenance and overhaul sector and support both direct and indirect jobs in our tourism sector,” he continued. “We saw the punishing increase to the cost of flights after the Ansett collapse, and this government will not stand by and let that happen again.”
Before Virgin Australia collapsed last month, Queensland was among the few who offered to invest in the airline — putting $200 million on the table.
“We are well-equipped to manage the state’s interest in Virgin Australia Holdings should the consortium be successful,” QIC Chief Executive Damien Frawley said.
“QIC’s track record as an acquirer, owner and manager of nationally critical infrastructure for both the Queensland government and long-term investors supports our consortium bid,” he continued.
Shares in Virgin Australia flatlined in mid-April at 8.6 cents each.