State’s bid to buy Virgin ‘laughable’, says Dutton

The Queensland Government has appointed a state-owned funds management group to manage its bid for a stake in Virgin Australia.

May 14, 2020, updated May 14, 2020
The State Government wants to save the airline and retain its headquarters in Brisbane. (Photo: ABC)

The State Government wants to save the airline and retain its headquarters in Brisbane. (Photo: ABC)

The airline went into voluntary administration last month following COVID-19 travel bans, but the State Government is keen for the airline – which has its headquarters in Brisbane – to continue operating.

Queensland Treasurer Cameron Dick on Wednesday confirmed the government’s investment could take the form of a direct equity stake, a loan, guarantee or another financial tool.

He said two sustainable, national airlines are critical in helping to “keep the air fair” and for job prosperity in the state.

“My number one focus as treasurer is to retain and create jobs for Queenslanders, particularly as we move beyond the COVID-19 crisis,” Dick said in a statement on Wednesday.

“We have an opportunity to retain not only head office and crew staff in Queensland, but also to grow jobs in the repairs, maintenance and overhaul sector, and support both direct and indirect jobs in our tourism sector.

“We saw the punishing increase to the cost of flights after the Ansett collapse, and this government will not stand by and let that happen again.”

The state-owned management group – Queensland Investment Corporation – will advise the government on the bid under the direction of chief executive Damien Frawley as part of Project Maroon.

But Home Affairs Minister Peter Dutton has savaged Queensland’s plans as laughable.

“Premier (Annastacia) Palaszczuk has almost bankrupted Queensland, and now in the middle of a crisis they want to buy an airline,” the MP for the Brisbane seat of Dixon tweeted.

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“It is laughable. She ‘leads’ a government which is corrupt and chaotic.”

Frawley said on Wednesday the restructure of Virgin Australia presented a significant opportunity for Queensland.

“We are well-equipped to manage the state’s interest in Virgin Australia Holdings should the consortium be successful,” Frawley said in a statement.

Dick said the airlines’ administrators, Deloitte, are seeking to conclude the sale process by June 2020.

“This is a competitive space, but Queensland is a serious contender and our discussions with the administrators have been making progress,” he said.


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