Origination

Virgin Australia, founded in 2000, was created to enable affordable, high-quality air travel across Australia while bringing a fresh, customer-focused alternative to the country’s aviation market.

By 2020, the airline was burdened by excessive leverage, an unsustainable business model, and COVID-era market pressures, was on the verge of collapse. Bain Capital invested in Virgin Australia during voluntary administration, leading to one of the most complex and high-profile restructurings in Australian corporate history.

We saw the opportunity to rebuild a critical part of Australia’s aviation infrastructure and position the airline for long-term success. Drawing on our deep expertise in aviation, consumer, and restructuring across the firm’s global platform, the team worked to reset the cost base, protect jobs, and create a sustainable foundation for recovery. From the outset, our goal was to stabilize the business, protect jobs, and chart a sustainable path to recovery.

Opportunity and investment

At the time of acquisition, Virgin Australia was operating under an unsustainable cost and operational structure, with approximately 5.5x leverage, seven different aircraft types, and a fleet of 140. We focused on three priority areas:

• Contract renegotiation: Over a concentrated administration period of just a few months, we renegotiated more than 500 supplier and lease agreements, generating over A$290 million in annualized savings and establishing a more efficient cost base.
• Fleet optimization: The fleet was reduced to approximately fifty aircraft during COVID and later rebuilt to approximately 100 aircraft across seventy-six routes to thirty-eight destinations, supported by simplification from seven aircraft types to a single Boeing 737 family.
• Customer experience and modernization: We supported the renewal of enterprise agreements, modernized the digital and loyalty ecosystems, and invested heavily in people and culture to strengthen service delivery and rebuild customer trust.

Value creation

Under our ownership, Virgin Australia achieved a comprehensive financial and operational turnaround. A stronger balance sheet, streamlined cost base, and revitalized product offering positioned the airline for sustainable growth and profitability.

• Customer rewards: We worked closely with the leadership team to redefine Virgin’s customer strategy, focusing on premium leisure and SME travelers while rebuilding trust in the brand. The Velocity loyalty program, now with over 13 million members, has become a key driver of engagement and recurring revenue.
• Strategic partnership: After suspending long-haul routes during its restructuring, Virgin Australia restored international connectivity through a strategic partnership with Qatar Airways, whose 25% equity stake was finalized in February 2025, broadening the carrier’s global network and competitiveness.
• Operational efficiency: EBITDAR margins reached the high teens with revenues approaching pre-COVID levels on a smaller fleet, enabled by simplification to a single Boeing 737 family fleet type from nine pre-administration.

Next chapter

In June 2025, Virgin Australia successfully re-listed on the Australian Securities Exchange (ASX) with a market capitalization of A$2.3 billion. Bain Capital retains a 30% shareholding, continuing our partnership as the airline enters its next phase of growth. The investment stands as a hallmark example of our cross-platform collaboration, operational expertise, and long-term commitment to transforming a national icon.

“Over time, we’ve rebuilt almost every part of the airline and set it up for great success—not only for today, but for decades going forward. It’s been invaluable having Bain Capital as a strategic partner who is part of our team and committed to rebuilding the business.”¹These endorsements are provided by certain CEOs and or founders of investments held by certain investment vehicles advised by Bain Capital affiliate investment advisers. None of these CEOs and or founders were directly compensated for providing these endorsements, however, the funds have made investments into such CEOs and or founders’ companies. As a result of this investment, a conflict of interest exists because the CEOs and or founders have an incentive to make positive statements about Bain Capital and their experiences with Bain Capital to maintain the goodwill with Bain Capital.

Jayne Hrdlicka / Former CEO / Virgin Australia

“What began as a bold bet on a beloved brand became one of the most rewarding transformation journeys we’ve ever been a part of. It’s taken grit, precision, tenacity, empathy, and creativity across every part of the business.”

Ryan Cotton / Partner / Bain Capital

“This IPO gives Australians a chance to invest in a strong national airline. We’re proud of the turnaround, and there’s more growth to come.”

Mike Murphy / Partner / Bain Capital