Virgin Australia is set to make its long-anticipated return to the Australian Securities Exchange on June 24, nearly four years after collapsing into administration at the height of the COVID-19 pandemic.
Private equity owner Bain Capital will launch an initial public offering (IPO) aimed at raising $685 million, reducing its stake in the airline from full ownership to 40 per cent, according to a report in the Australian Financial Review.
The IPO will value Virgin Australia at $2.3 billion, with an enterprise valuation of $3.6 billion and shares priced at $2.90—representing a 30 per cent discount to the trading multiple of rival Qantas. A total of 236.2 million shares will be offered, with bidding due by Thursday afternoon.
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Under the float structure, 30 per cent of stock will be sold to new investors. Qatar Airways will retain a 23 per cent stake, while Virgin’s management will hold 7.8 per cent. Bain has agreed to a post-IPO lock-up period and will not sell any shares until after Virgin’s half-year results in December. If the share price meets certain targets, Bain may sell up to 10 per cent of the company.
The listing follows a period of strategic restructuring under Bain, which acquired Virgin Australia in 2020 after it entered voluntary administration amid Australia’s international border closures and widespread travel disruptions. Over the past five years, Bain has streamlined operations and returned the airline to profitability.
The IPO also follows significant leadership changes, with former chief commercial officer Dave Emerson appointed CEO in March after the departure of Jayne Hrdlicka. Earlier this year, the Foreign Investment Review Board approved Qatar Airways’ acquisition of a 25 per cent stake, further solidifying the carrier’s ownership structure ahead of the re-listing.
Virgin’s existing shareholders, including Bain Capital, the Virgin Group, and the Queensland Investment Corporation, received a $730 million capital return in 2023, reflecting their respective 93, 5, and 2 per cent stakes.
As part of the IPO, Virgin employees will also benefit. Eligible staff will receive $3,000 in share rights under a “Take-Off Grant” designed to recognise their contribution to the airline’s turnaround. In an internal communication, CEO Emerson confirmed the grants would be awarded at the time of the listing.
