Virgin Australia Holdings Limited (ASX: VAH) launches ASX-listed Virgin Australia Notes Offer

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Five year A$ unsecured notes with an expected Interest Rate of 8.00% per annum

Virgin Australia Holdings Limited (ASX: VAH) (Virgin Australia) announced today that it has lodged a prospectus (Prospectus) with the Australian Securities and Investments Commission (ASIC) for an offer of A$ denominated unsecured notes to be listed on the Australian Securities Exchange (ASX) (Virgin Australia Notes or Notes) to raise A$150 million with the ability to raise more or less (the Offer).

The Offer, together with the US$425 million US$ Notes Offer, the pricing of which was announced to ASX on 25 October 2019,1 forms part of Virgin Australia’s funding strategy in connection with its acquisition of 100% ownership of the award-winning ‘Velocity’ loyalty program (Velocity). Any surplus proceeds from the Offer and the US$ Notes Offer in excess of the amount required for the acquisition will be used for general corporate purposes.

Notes are expected to be quoted on the ASX under the ASX code “VAHHA”.

Key features of Notes

  • Notes are unsecured notes to be issued by Virgin Australia;
  • Notes will rank equally with Virgin Australia’s other unsecured US$ and A$ notes;
  • Notes have a five year maturity (Maturity Date: 26 November 2024);
  • Notes will pay holders fixed rate, cumulative, unfranked interest payments semi-annually in arrear;
  • The Interest Rate is to be determined under the Bookbuild and is expected to be 8.00% per annum;
  • The Bookbuild is scheduled to take place on or before 4 November 2019;
  • Virgin Australia may elect to Redeem the Notes at any time before their Maturity Date at a ‘make whole’
  • Redemption Amount up to the third anniversary and thereafter at a fixed premium;
  • Non-payment of Interest or Redemption Amount when due and payable is an Event of Default (subject to applicable grace periods);
  • Virgin Australia’s obligation to make payments under the Terms is guaranteed by certain members of the
  • Virgin Australia Group; and
  • The minimum investment in Notes is A$5,000 (50 Notes).

About the Offer

The Offer will comprise:

  • an Institutional Offer – an offer to Institutional Investors in certain jurisdictions (excluding the United States) who have been invited by Virgin Australia or the Joint Lead Managers to bid for Notes in the Bookbuild; and
  • a Broker Firm Offer – an offer to eligible Australian resident clients of Syndicate Brokers.

Key dates for the offer

Key date Date
Lodgement of the Prospectus with ASIC 28 October 2019
Bookbuild On or before 4 November 2019
Opening Date of the Offer and lodgement of the Replacement Prospectus with ASIC 5 November 2019
Closing Date for the Broker Firm Offer 10.00am 25 November 2019
Issue Date 26 November 2019
Notes expected to commence trading on ASX (deferred settlement basis) 27 November 2019
Holding Statements dispatched by the Registry On or before 28 November 2019
Notes expected to commence trading on ASX (normal settlement basis) 29 November 2019

The key dates and times for the Offer are indicative only and may change without notice. All references to time are to Sydney time.

How to apply for Notes

Full details of Notes and the Offer are set out in the Prospectus lodged today with ASIC and ASX. The Prospectus is available for download within Australia at www.virginaustralianotes.com.

A Replacement Prospectus, containing the final Interest Rate and Application Forms, will be lodged with ASIC and made available from the Opening Date for the Offer, expected to be on 5 November 2019.

Investors should consider the Prospectus in deciding whether to apply for Notes. Applications can only be made using the Application Form attached to or accompanying the Replacement Prospectus.

Capitalised terms in this release have the meaning given to them in the Prospectus.

UBS AG, Australia Branch has been appointed as Arranger and Joint Lead Manager for the Offer. Morgan Stanley Australia Securities Limited, Morgans Financial Limited and Ord Minnett Limited have also been appointed as Joint Lead Managers for the Offer.

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