By Gina Lee
Investing.com – Virgin Australia Holdings (ASX:VAH) administrator Deloitte has chosen Bain Capital as the preferred bidder for the troubled airline.
The U.S. private investment firm said on Friday that it will buy the airline for an undisclosed sum, to be raised via private equity in addition to distressed and special situation funds.
Bain Capital beat a bid from Cyrus Capital Partners as well as a recapitalization proposal submitted at the last hour by Virgin Australia bondholders to be selected. But Cyrus Capital Partners said earlier in the day that it had pulled out of the bidding process.
The deal‘s finalization will require approval from 50% of the airline’s creditors, both by value and number. Once finalized, Bain Capital will strengthen Virgin Australia’s regional routes and entice leisure passengers with good deals, said Mike Murphy, a managing director at the firm.
With Bain Capital’s selection, Deloitte ends its search of over two months for a buyer for the airline. Virgin Australia entered administration in April with debts of nearly AU$7 billion ($4.8107 billion) to its creditors. It is the second largest airline in the country, behind Qantas Airways (ASX:QAN).