Virgin suspended from ASX
16 April 2020, Written by David Simmons
Two days after entering into a trading halt Virgin Australia (ASX: VAH) has requested an immediate suspension of its ordinary shares and unsecured notes on the ASX.
The suspension relates to internal discussions at Virgin regarding how the airline intends to continue during the Covid-19 crisis, including deliberation over financial assistance and restructuring alternatives.
"Whilst this consideration and these discussions have continued over the last two days including discussions which remain confidential and are incomplete, the company is not presently in a position to make an announcement to the market with respect to these matters," says Virgin.
"In particular the company requests that trading in its securities be suspended to enable this consideration and these discussions to continue so as to ensure the market is not trading in the relevant securities on an uninformed basis."
The suspension will remain in place until the Virgin makes an announcement regarding these discussions or at the expiry of seven days from today's date 16 April.
It has been reported that Virgin could be looking at going into voluntary administration if support from the Federal Government is not granted.
As reported by The Guardian, Virgin has hired insolvency and turnaround experts at Deloitte to consider restructuring the business or going into administration.
Virgin's decision comes after the airline announced last week that it would be suspending all domestic passenger flights except for a daily Sydney to Melbourne service (but not on Saturday).
The company also recently stood down around 10,000 staff and suspended all Tigerair Australia domestic services. International flights have also been suspended until mid-June except for one return flight per week between Los Angeles and Brisbane and two return flights between Hong Kong and Brisbane. These flights have been scheduled to ensure Australians can get back home.
Virgin is also running flights to maintain important freight links into the country.
Updated at 9:34am AEST on 16 April 2020.
Author: David Simmons