Virgin Australia chairman Elizabeth Bryan says the airline group’s board has discussed the matter of whether the company should be privatised.
Speaking to shareholders at the company’s annual general meeting (AGM) in Brisbane on Wednesday, Bryan noted there had been speculation over the past year regarding whether the airline group would remain listed on the Australian Securities Exchange (ASX), given its small percentage of minority shareholders.
However, while the board had discussed the matter, no conclusions had been reached.
“The group has a small free float and many have asked the question of whether it is appropriate to remain listed, or to become a privately-held company,” Bryan said in prepared remarks.
“We have a responsibility to ensure that we act in the best interests of all shareholders and in the long-term interest of the company. As part of fulfilling this responsibility, the board has held discussions about privatisation, however there is no outcome to report to the market at this stage.”
Virgin Australia’s five major shareholders – Etihad Airways, HNA Group, Nanshan, Singapore Airlines and UK-based Virgin Group – hold more than 90 per cent of issued stock in the company.
Privatisation would mean Virgin Australia would be de-listed from the Australian Securities Exchange (ASX) and no longer be subject to obligations such as continuous disclosure rules.
Any process to de-list the company could be achieved through existing major shareholders buying more shares under so-called creep provisions that allows them to increase their stake without making a takeover bid, a management buyout or one shareholder announcing a takeover bid.
Bryan said it was her responsibility as chairman to act in the best interests of all shareholders.
“As an independent chair with a large and varied shareholder base, I am particularly conscious of what a small free float means for our minority shareholders,” Bryan said.
“It is my responsibility, and that of all our directors, to ensure that the interests of the minority shareholders are represented at the board.”
Virgin Australia shares were up 1.2 cents, or 6.15 per cent, at 20.7 cents, in morning trade on the ASX.