Sydney (TAN): Virgin Australia will buy back the remaining 35% of its Velocity Frequent Flyer programme from PE group Affinity Equity Partners, media reports citing a company announcement said.
The AUD 700 million (USD 481.22 million) deal will be closed by the end of 2019.
[ALSO READ: Taiwan asks citizens not to travel to Hong Kong and mainland China]
According to the company announcement, the acquisition was subject to conditions including the finalisation and execution of long form documentation, funding and receiving the Australia’s Foreign Investment Review Board’s nod.
Ratings agency Standard & Poor’s is of the opinion that the airline has “sufficient balance sheet capacity” to retake control of Velocity but if the move was debt-funded, it may reduce the company’s financial flexibility, according to a media report.
[ALSO READ: Airbnb partners with Atlas Obscura, leads USD 20 million funding round]
Virgin Australia recorded its seventh consecutive annual loss in August and said it would cut 750 corporate and head office jobs as part of a restructure to save AUD 75 million by the end of the 2020 financial year.
