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Virgin Australia offers locked in as bidding race hits final straight

Mr Strawbridge said Cyrus and Bain had both flagged their intention to make Virgin a smaller airline flying domestic and short-haul international routes and to shut its budget Tigerair brand.

“Ultimately the size of the airline will be dependent on the timing and level of demand by customers as travel restrictions are eased,” he said.

“Bain and Cyrus have done an enormous amount of work to get here today, are well-funded and are enthusiastic supporters and see real value in this business going forward.”

He said both bidders were committed to “a strong, competitive and sustainable Virgin Australia operating into the future, employing many thousands of Australians and supporting the tourism industry and state and national economies”.

Sources close to the sale said on Monday that Cyrus Capital had teamed up with the Queensland Investment Corporation (QIC) for its bid. The state-owned investor had previously said it would provide up to $200 million in financial support to a bidder that committed to keeping Virgin headquartered in Brisbane. A QIC spokesman said the fund continued to talk to both bidders.

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Bain and Cyrus have each said they will keep Virgin’s existing chief executive Paul Scurrah and his management team in place and have backed their “Virgin 2.0” revival plan. That plan will see Virgin strip back to a single aircraft type domestic fleet of Boeing 737s focused on flying profitable routes.

Two unions representing Virgin cabin crew and engineers publicly backed Cyrus last week owing to its experience owning airlines and because they believed it would save more jobs than Bain.

That prompted Bain’s local boss Mike Murphy to reassure Virgin’s 9000 staff his fund would not cut any deeper than Cyrus, and also pledged not to turn Virgin back into a budget airline.

Deloitte will put its preferred bid before a vote of creditors in mid-August.

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