Virgin Australia shares take off as airline returns to trade on ASX
Virgin Australia shares have rallied as the airline has officially returned to the stock market, marking one of the most anticipated listings of the year and the latest chapter in its turbulent journey.
Virgin's initial public offering (IPO) was priced at $2.90 per share, raising $439 million for the company.
As the company resumed trade on the Australian Securities Exchange (ASX) on Tuesday afternoon, Virgin shares lifted more than 8 per cent to $3.15 by 12:15pm AEST.
After collapsing into administration at the height of the COVID-19 pandemic in 2020, Virgin was rescued by US private equity giant Bain Capital and delisted from the stock exchange.
Now the airline has taken off on the ASX once more, with a leaner business model, a new shareholder mix and the financial muscle of Qatar Airways behind it.
At the completion of the IPO, Bain's stake in Virgin was reduced to about 40 per cent, while Qatar Airways retained about 23 per cent, according to the prospectus.
More than five years ago now, Virgin's fall was swift and dramatic. However, it was also entirely predictable if considered the fate of Ansett Australia.
A fierce price war with Qantas had left Virgin financially vulnerable. Then came the global pandemic, grounding fleets and evaporating revenue almost overnight.
"Qantas was worried that Virgin Australia was going to attack its corporate travel market and go after the business market, so we had this brutal price war which left Virgin Australia a little bit weak," aviation analyst Peter Harbison told ABC News.
"And then when it was just starting to recover, COVID came along and it went into administration."
In April 2020, Virgin entered voluntary administration, with its boss blaming its failure to secure a federal government bailout.
Within months, the airline was sold to Bain Capital for $3.5 billion.
Bain Capital grounded budget offering Tiger Airways for good and set about repositioning Virgin as a mid-market offering.
Virgin returned to profitability in 2023. Mr Harbison said Virgin Australia offered fewer inclusions than Qantas but broader appeal than budget airline Jetstar.
"The lounges are more limited. Its product is really very much tailored to the mid-market, which does suggest quite a lot."
As of February, this year Virgin has an additional backer in government-owned Qatar Airways, which bought a 25 per cent stake in the airline and delivers more access to international routes.
"Now with Qatar, they have a very tidy deal which will very much help them in the future," Mr Harbison said.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Perth Now
23 minutes ago
- Perth Now
Virgin soars in 'luckiest' Aussie share debut of year
Virgin Australia has returned to the stock market with a transaction that timed its arrival perfectly. Shares in the nation's second-biggest airline were changing hands at $3.165 on Tuesday afternoon, up 9.1 per cent from their $2.90 listing price. Virgin shares began trading under the ticker code VGN at noon, hours after word of a likely ceasefire between Iran and Israel sent oil prices tumbling. "Until yesterday there were concerns the airline's IPO was hitting the market at the wrong time, but the overnight action has changed everything," Moomoo market strategist Michael McCarthy said. "Now, with risk appetites rising and oil prices dropping as fears of war recede, Virgin might be the luckiest debutant of the year." Jet fuel typically is the biggest operational expense for any airline, typically representing around 30 per cent of all costs, according to the International Air Transport Association. As with petrol, the price of the refined fuel is closely linked to the price of crude oil, which fell sharply at a possible end to the Middle East hostilities. Virgin's pre-existing owners - including US investors Bain Capital, Qatar Airways Group, Virgin Group and the Queensland Investment Corporation - sold a 30.2 per cent stake in the airline for $685 million, giving it a market capitalisation of $2.3 billion based on the offer price. Its chief rival, Qantas, was valued at more than $15 billion on Tuesday. Virgin collapsed into voluntary administration at the start of the COVID-19 pandemic in April 2020, owing $7 billion to more than 12,000 creditors. It was acquired by Bain in November of that year for $700 million before being delisted from the stock market and restructured. "Today marks the start of an exciting new chapter for Virgin Australia as a publicly listed company," Virgin Australia chairman Peter Warne said. "Our listing reflects the remarkable work undertaken over the past five years to transform the airline and position it for long-term success. "It is great news not just for our people, but for travellers who rely on Virgin Australia being a strong, resilient and competitive airline." Virgin Australia chief executive Dave Emerson said the airline was entering its next phase with a clear strategy, simplified operating and commercial models and strong team. Staff were being offered $3,000 "take-off grants" that would convert to ordinary shares if they remained with the company during a 24-month vesting period in recognition of their contributions to the airline's success, he said. Virgin flies a fleet of more than 100 aircraft on 76 domestic and short-haul international routes. Earlier in June, it began long-haul services between Australia and Doha under a "wet lease" agreement with Qatar Airways. Under such deals, the lessee provides the plane and crew, while the lessor sells the tickets and markets the flights.
The Australian
31 minutes ago
- The Australian
YouTube ban for children proposed by Australia's E-Safety Commissioner
The e-Safety Commissioner has announced an imminent crackdown, forcing big tech to clamp down on restricting children from accessing porn, violent videos, and content which promotes disordered eating a self-harm. Speaking to the National Press Club in Canberra on Tuesday, Julie Inman Grant said she will register three industry prepared codes targeting the three content categories, warning that she will enforce 'mandatory standards' if the codes do not meet 'appropriate community safeguards'. The codes will apply to all eight sectors of the tech industry, including social media, websites, search engines, app stores, device manufacturers, hosting services, internet providers and other online services like gaming, messaging programs and dating apps. She said the codes will operate in 'lock step' with the social media ban for under 16s, and offer another layer of defence preventing children from accessing harmful material. 'I have informed industry I plan to register the codes covering enterprise hosting services, internet carriage services such as telcos, and other access providers, and search engines,' she said on Tuesday. 'I sought additional safety commitments from industry on the remaining codes, including those dealing with app stores, device manufacturers, social media services and messaging, and the broader categories of relevant electronic services and designated internet services or the DIS.' E-Safety Commissioner Julie Inman Grant called on all sectors of the tech industry to act on the codes or risk mandatory standards. Picture: NewsWire/ Martin Ollman The codes will force operators to create strengthened protections around AI companions like ChatGPT and chat bots, with Ms Inman Grant threatening further action if they don't go far enough. 'I want to ensure these provide vital and robust protections. Industry confirmed last week they would seek to make some of these changes, and I plan to make my final determination by the end of the month,' she said. 'If I'm not satisfied these industry codes meet appropriate community safeguards, I will move to making mandatory standards.' Her comments come ahead of the under 16s social media ban coming into force in December 10, with Ms Inman Grant stating she was confident work required to enforce the ban would meet the looming deadline. Ms Inman Grant has also called for YouTube not to be exempted from the rules, and said any platform claiming it was 'absolutely safe' was 'spinning words,' adding that her office had called on the platform to remove 'illegal, class one and class two content'. The recommendation was made in writing to Communications Minister Annika Wells last week, who is ultimately responsible for enforcing the code. Ms Inman Grant called on YouTube to be excluded from the list of exempted platforms once the under-16s social media ban comes into affect. Picture: NewsWire/ Aaron Francis She added that teachers would still be allowed to show students educational content, and children can still access YouTube, and other social media platforms, when logged out. 'I think what we're trying to do here is harness the positives and still enable people to engage without the persuasive pull of these algorithms and technologies designed to make social media addictive, or if you're looking for diet information, to further send information about bulimia and anorexia,' she said. YouTube has refuted Ms Inman Grant's comments accusing her of ignoring data which shows the platform's educational benefits, and says it should be classified as a video streaming platform. 'In 2024 a survey found that a staggering 84 per cent of teachers in Australia use YouTube on at least a monthly basis in the classroom with the same number saying it helps students continue learning outside the classroom as well,' said YouTube Australia and New Zealand's public policy and government relations senior manager Rachel Lord. 'Today, the eSafety commissioner chose to ignore this data, the decision of the Australian government and other clear evidence from teachers and parents that YouTube is suitable for younger users by recommending the platform's inclusion in Australia's social media ban.' Ms Lord also said the commissioner's comments 'goes against' the governments own commitment, and called on it to ignore Ms Inman Grant's call. 'We urge the Government to follow through on the public commitment it made to ensure young Australians can continue to access enriching content on YouTube,' she said. Jessica Wang NewsWire Federal Politics Reporter Jessica Wang is a federal politics reporter for NewsWire based in the Canberra Press Gallery. She previously covered NSW state politics for the Wire and has also worked at and Mamamia covering breaking news, entertainment, and lifestyle. @imjesswang_ Jessica Wang
Herald Sun
31 minutes ago
- Herald Sun
Virgin relists as ASX climbs, oil sinks
Don't miss out on the headlines from Stockhead. Followed categories will be added to My News. ASX jumps as war fears ease, and oil tanks Virgin lands back on ASX after $685m IPO Collins rockets, TWE pops, CBA breaks records The ASX came out swinging on Tuesday, jumping 1% by lunch time in the east as traders piled back into risk. Although energy stocks were whacked after crude prices plummeted 9% overnight, the rest of the ASX market had a ripper. The plunge in oil was triggered after Iran's retaliation to US strikes appeared to be all puff. The missile barrage in Iraq and Qatar didn't hit oil infrastructure, and the Strait of Hormuz wasn't blocked. Trump immediately declared a 'complete and total ceasefire' between Iran and Israel, even if Iran later said, 'eh, not quite'. Either way, it was enough for the ASX, Asian stock markets and US futures to rip higher this morning. Not surprisingly, though, local energy names felt the pinch. Woodside Energy Group (ASX:WDS) tumbled 7.5%, and Santos (ASX:STO) dipped 1.5%. But elsewhere, Commonwealth Bank (ASX:CBA) hit another intraday record, cracking $188.36 after topping its own Monday high. Over in the mining pits, Rio Tinto (ASX:RIO) and Fortescue (ASX:FMG) gained nearly 3% each. Tech darlings were also in the winners' circle, with WiseTech Global (ASX:WTC) climbing 4%, and NextDC (ASX:NXT) up by 2%. Source: Market Index In other large caps news, Treasury Wine Estates (ASX:TWE) put a grin on investor faces, rising as much as 6% after reaffirming earnings guidance and hinting at a 5% share buyback. Penfolds growth might slow next year, but TWE said it was still betting big on luxury wines, Asia and a fancy new premium division called Treasury Collective. And Collins Foods (ASX:CKF) absolutely exploded, up 18% despite reporting an 88.5% plunge in statutory net profit. The market seems to think the worst is over for Collins. Same-store sales are picking up, interest rates are starting to ease, and the company is still dishing out a 15c fully franked dividend. But, here's the main event today: Virgin Australia (ASX:VGN) has finally touched back down on the ASX runway. Virgin's shares opened at $3.15, up around 8% on its IPO price. After raising $685 million in a heavily oversubscribed IPO, Virgin is back on the boards, five years after it crashed into administration and delisted with $7 billion in debt. Bain Capital did the heavy lifting, turning the airline into a leaner mid-market player. Qatar Airways is still in with its 23% stake. The timing's not bad, too. Domestic travel's picking up, the ASX is in decent form, and oil prices are doing a nosedive today. Even Qantas (ASX:QAN) shares jumped 3.5% this morning on the oil news. Investors are also hoping Virgin's re-listing might finally break the post-Covid IPO drought and get some fresh names flying onto the ASX. ASX SMALL CAP WINNERS Here are the best performing ASX small cap stocks for June 24 : Security Description Last % Volume MktCap GBZ GBM Rsources Ltd 0.013 117% 43,344,251 $7,026,420 OLY Olympio Metals Ltd 0.080 86% 1,702,245 $3,786,894 AXP AXP Energy Ltd 0.002 50% 5,007,393 $6,684,681 JAY Jayride Group 0.002 50% 300,001 $1,427,889 MEL Metgasco Ltd 0.003 50% 100,000 $3,665,173 SRL Sunrise 0.950 46% 840,166 $71,647,874 OLH Oldfields Holdings 0.021 31% 153,166 $3,408,946 LOC Locatetechnologies 0.175 30% 2,693,178 $30,865,953 RML Resolution Minerals 0.050 25% 28,921,673 $26,325,061 AAU Antilles Gold Ltd 0.005 25% 2,763,007 $9,505,472 OVT Ovanti Limited 0.003 25% 2,268,516 $6,011,030 SRJ SRJ Technologies 0.005 25% 3,515,049 $2,422,312 TMK TMK Energy Limited 0.003 25% 7,209,330 $20,444,766 VML Vital Metals Limited 0.003 25% 5,118,290 $11,790,134 ICR Intelicare Holdings 0.006 20% 1,083,166 $2,430,941 KME Kip McGrath 0.500 19% 209,810 $23,901,019 CLG Close Loop 0.025 19% 4,659,180 $11,168,847 LMG Latrobe Magnesium 0.010 19% 4,674,674 $21,012,720 CKF Collins Foods Ltd 8.510 17% 2,023,315 $855,828,496 RPG Raptis Group Limited 0.041 17% 240,770 $12,273,970 AX8 Accelerate Resources 0.007 17% 950,236 $4,903,132 EXL Elixinol Wellness 0.014 17% 40,041 $2,752,699 FAU First Au Ltd 0.004 17% 5,654 $6,215,980 ID8 Identitii Limited 0.007 17% 530,000 $4,668,081 LU7 Lithium Universe Ltd 0.007 17% 371,510 $4,715,878 GBM Resources (ASX:GBZ) is raising $13 million through a placement to wipe out debt and ramp up exploration at its Twin Hills and Yandan gold projects in Queensland's Drummond Basin. It's bringing in heavyweight Ian Middlemas as chairman, along with Peter Fox and Robert Behets as new directors, as part of a broader board reshuffle. The raise clears all $6.2 million in convertible notes and ends a previous farm-in deal with Wise Walkers, who'll now join the register with a 20% stake. With zero debt and 1.84Moz in JORC gold resources, GBM says it's ready to go hard on drilling and unlock more gold across its 100%-owned tenements. Olympio Metals (ASX:OLY) has struck visible gold in the very first drillhole at its maiden program in Quebec's Bousquet gold project, hitting a nine-metre mineralised zone at the Paquin prospect from 183 metres down. The gold sits in smoky quartz veining loaded with sulphides and strong alteration, with more promising geology logged down to 286 metres. It's a strong start for a project located along the Cadillac Break, one of Canada's top-tier gold belts, and assays from the hole are due mid-July. ASX SMALL CAP LOSERS Here are the worst performing ASX small cap stocks for June 24 : Code Name Price % Change Volume Market Cap ERA Energy Resources 0.002 -33% 5,870,740 $1,216,188,722 GMN Gold Mountain Ltd 0.001 -33% 86,623,800 $8,429,639 HLX Helix Resources 0.001 -33% 2,000,000 $5,046,291 JAV Javelin Minerals Ltd 0.002 -33% 2,670,345 $18,378,447 ANX Anax Metals Ltd 0.005 -29% 16,845,063 $6,179,653 AMS Atomos 0.003 -25% 5,490,704 $4,860,074 HCD Hydrocarbon Dynamics 0.002 -25% 2,185 $2,156,219 CUL Cullen Resources 0.004 -20% 1,366,467 $3,467,009 EE1 Earths Energy Ltd 0.004 -20% 808,300 $2,649,821 MEM Memphasys Ltd 0.004 -20% 125,000 $9,917,991 RLG Roolife Group Ltd 0.004 -20% 60,000 $7,963,906 BEL Bentley Capital Ltd 0.009 -18% 31,765 $837,407 BRU Buru Energy 0.025 -17% 4,475,430 $23,382,288 AN1 Anagenics Limited 0.005 -17% 8,940,000 $2,977,922 CYQ Cycliq Group Ltd 0.003 -17% 233,333 $1,381,550 DGR DGR Global Ltd 0.005 -17% 2,153,600 $6,262,176 GLL Galilee Energy Ltd 0.005 -17% 424,500 $4,243,157 SHP South Harz Potash 0.003 -17% 214,146 $3,308,186 TEG Triangle Energy Ltd 0.003 -17% 3,446,596 $6,267,702 GRV Greenvale Energy Ltd 0.031 -16% 195,148 $20,141,814 DME Dome Gold Mines Ltd 0.160 -16% 3 $79,159,949 HHR Hartshead Resources 0.006 -14% 140,000 $19,660,775 ODE Odessa Minerals Ltd 0.006 -14% 321,578 $11,196,728 CTN Catalina Resources 0.004 -13% 157,760 $9,704,076 ENV Enova Mining Limited 0.007 -13% 420,089 $11,660,801 IN CASE YOU MISSED IT Having encountered a substantial amount of supergene gold at the Gidji joint venture project, Miramar Resources (ASX:M2R) is launching a sub-audio magnetic survey in a bid to find the source. X2M Connect (ASX:X2M) has secured a $3 million public safety contract with the City of Seoul in South Korea for its smart personal safety devices. Sierra Nevada Gold (ASX:SNX) has returned high-grade gold from sampling at four historic tailings dams at its New Pass project in Nevada, USA. Magnetic Resources (ASX:MAU) has boosted contained gold resources at its Lady Julie project in WA's Laverton region by ~22% to 2.14Moz just days after signing a key native title agreement. LAST ORDERS Sovereign Metals' (ASX:SVM) conservation farming program in Malawi has drastically increased crop yields for local farmers, achieving four times the traditional yield and up to 10 times for the top performing farmer. SVM launched its conservation farming program as part of the development of the nearby Kasiya rutile and graphite project in 2024. An additional 260 farmers have joined since the original 90 trained with the program the previous planting season. Titanium Sands (ASX:TSL) executives have come away from a conference with the Ministry of Finance, Planning and Economic Development, and similar stakeholders in Sri Lanka with a firm belief the government is supportive of a heavy mineral industry. The company presented its view on frustrations and delays the project had encountered while focusing on solutions and where the Ministry could streamline the approvals process. At Stockhead, we tell it like it is. While Sovereign Metals and Titanium Sands are Stockhead advertisers, they did not sponsor this article. This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions. Originally published as Lunch Wrap: Virgin's ASX comeback lifts market mood as oil stocks slump
