Virgin Australia’s strategic alliance partner Qatar Airways is looking to take a 20 per cent stake in the domestic airline as VA owner Bain Capital seems set to offload and delay its long-awaited public listing on the Australian Stock Exchange (ASX).
If successful, QR, which formed a strategic and codeshare partnership with Virgin Australia in September 2022, would take on the dominant Qantas Group to offer both domestic and international long-haul services.
The Qatari government-owned airline had its bid for more flight slots in Australia thwarted by Qantas in 2023 and an increased stake in Virgin Australia could see a QR-VA alliance go up against the Qantas-Emirates partnership.
In July 2023, Federal Transport Minister Catherine King vetoed QR’s request for 21 more flights per week to Sydney, Melbourne and Brisbane on top of the 28 flights it operated weekly.
At the time, industry heavyweights called on the Australian government for an urgent review to clear the way for more QR flights to Australia, citing improved competition.
Any QR-VA deal would also be subject to Australian government approval.
Fairer fares?
Australian aviation expert Geoffrey Thomas told Nine Network’s Today that a QR-VA deal would be good for competition, lowering both international and domestic airfares.
Boston-based Bain Capital purchased VA for $3.5 billion in 2020 when the airline was in voluntary administration. The private equity firm has delayed its ASX listing since announcing it in January 2023. An initial public offering (IPO) is still a potential by the end of this year.
VA reported an interim FY24 revenue of AUD$2.8 billion in the six-month lead-up to 31 December 2023, an uptick of $300 million on the same period last year for a strong start to 2024.
