State launches ambitious bid to buy Virgin Australia
QUEENSLAND Investment Corporation will launch an ambitious bid to buy Virgin Australia on behalf of the state in what would be one of the most significant investments in its history.
A consortium led by QIC is rapidly developing a bid for the state to purchase a stake in the Queensland-based carrier ahead of Friday's deadline for non-binding offers.
About 19 bidders are circling the airline, which collapsed into administration last month with debts totalling almost $7 billion.
Just days into his new role Treasurer Cameron Dick has tasked the government-owned investment corporation with forming a bid to keep the airline headquartered in Queensland.
"The appointment of QIC, led by CEO Damien Frawley, has enabled work to progress quickly on a comprehensive strategy, to ensure Queensland is best positioned for a successful bid," he said.
"QIC will advise government on all aspects of the bid, including the optimal partner group, the quantum and structure of the state's contribution, as well as probity and governance."
Mr Dick said the government's investment could take the form of a direct equity stake, a loan, guarantee or other financial incentives.
Queensland's bid comes as several other Australian states consider making their own investment in Australia's second-largest carrier.
QIC CEO Damien Frawley said the restructure of Virgin Australia represented a significant opportunity for Queensland.
"We are well-equipped to manage the state's interest in Virgin Australia Holdings should the consortium be successful," he said.
"Virgin administrator Deloitte has set an ambitious timeframe and we look forward to delivering on this mandate for the Queensland Government."
Mr Dick said keeping Virgin Australia flying into the state and 2000 people working here was vital to Queensland's COVID-19 recovery.
"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 said.
"Queensland is Australia's home of aviation and with all our competitive advantages, we fully intend to stay that way."
Administrators are hoping to conclude the sale process by June 2020.
"This is a competitive space, but Queensland is a serious contender and our discussions with the administrators have been making progress," Mr Dick said.
Originally published as State launches ambitious bid to buy Virgin Australia