Virgin Australia airline seeks bankruptcy protection

CANBERRA: Virgin Australia announced on Tuesday it had entered voluntary administration, seeking bankruptcy protection after a debt crisis worsened by the coronavirus shutdown pushed it into insolvency. Virgin said in a statement to the Australian Securities Exchange that it had appointed a team of Deloitte administrators to “recapitalise the business and help ensure it emerges in a stronger financial position on the other side of the Covid-19 crisis”.

Virgin's administrators have taken control of the company and will try to work out a way to save either the company or its business. The move came after the Australian government refused Virgin’s request for a 1.4 billion Australian dollar ($888 million) loan.

Rival Qantas Airways argued that it had three times more revenue than Virgin and was therefore entitled to a AU$4.2 billion ($2.7 billion) loan if the smaller airline was not to gain an unfair advantage.