Exclusive: Virgin Australia bondholder launches court action to unveil secret Bain deal | pwhatch
One of Virgin Australia's largest bondholders has launched court action to unseal the secret details ofas it steps up its efforts to take control of the company.
Broad Peak Investment lodged an interlocutory process in the Federal Court on Tuesday seeking access to the sale agreement between Virgin's administrator Deloitte and Bain.Bain and Deloitte have refused to say how much the private equity firm will pay Virgin's creditors, which are owed a combined $6.8 billion, or how many of Virgin's 9000 workers will lose their jobs.
Broad Peak, a Singaporean hedge fund, was part of a group of bondholders that proposed swapping their $2 billion in debts for ownership of Virgin. Deloitte passed over the proposal and a rival bid from Cyrus Capital in favour of Bain., arguing the way Deloitte ran the administration was "unacceptable" and blocked them from presenting their alternative deal to creditors at the second creditors' meeting in August.
The bondholder group is being advised by boutique Sydney firm Faraday Associates and lawyers from Corrs Chambers Westgarth. The group's debt-for-equity plan involved pouring $925 million into Virgin to keep the company alive and listed on the Australian Securities Exchange. Virgin's $2 billion worth of unsecured bonds are owned by 30 large institutional investors and about 6000 "mum and dad" retail investors. Broad Peak is backed by Singapore's sovereign wealth fund Temasek, which held an interest in Virgin through its majority ownership of Singapore Airlines, which in turn owned 20 per cent of Virgin.
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