Inter globe Enterprises stated that it had now signed an agreement to engage in the purchase of Virgin Australia.
The purchase deal comes three weeks after the Australian airline Virgin Australia declared bankruptcy due to the Coronavirus epidemic. Rahul Bhatia-owned Inter globe Enterprise is evaluating Virgin Australia, a company owned by Richard Branson, and finalizing the strategy.
Inter globe Enterprises, the largest shareholder of Indigo Airlines, has a 37.87 percent stake in it. Due to the Coronavirus epidemic and lockdown, the aviation industry around the world is going through a big crisis. Many aviation companies have started preparing to sell themselves after bankruptcy and ceasing operations Bank Reception
Inter globe Enterprises stated in the matter that, ‘Concerning Virgin Australia, Inter globe Enterprises has signed an agreement to participate in the sales process and the confidentiality requirements of that agreement bound us.
Virgin Australia was shut down on 21 April 2020, causing 16,000 job losses. Virgin Australia is Australia’s second-largest airline which sought protection under the insolvency process to strengthen its financial position due to the deficit crisis. Currently, Virgin Australia owes about $ 4.5 billion to more than 10,000 lenders. This deal would be quite crucial for inter globe enterprises as its having a significant amount of shares in Indigo.
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Currently, the aviation industry is severely affected by the Coronavirus global epidemic. The aviation sector revenue is expected to decline by up to 44 percent in the current fiscal year 2021. According to the INCRA report, airline companies will need additional capital of Rs 350 billion in three years to continue their operations.
The conditions are so adverse that most of the airline companies have deducted their employees’ salaries and sent employees on leave without pay. Pilots and cabin crew are now fired from their jobs to reduce costs and burden from the company. This situation will remain until the cash problem is over, and the pandemic stops.