Perth Airport has seized a number of Virgin Australia aircraft.
Perth Airport has seized a number of Virgin Australia aircraft.

Drama as airport seizes Virgin aircraft

Perth Airport is blocking four Virgin Australia aircraft from leaving to ensure it is paid $16 million it claims it is owed by the collapse airline.

Sources at the airport told The West Australian yesterday that the airport has a lien - a legal right of possession until a debt is paid - on four planes, though two of them do not have engines at the moment.

One aircraft, a wide-body A330 which is not in use, has an airport vehicle parked in front so a tow bar cannot be attached and another has a bulldozer blocking access.

Perth Airport's unpaid debt from Virgin comes on top of $20 million that Qantas has refused to pay on outstanding invoices.

The airport had previously confirmed it expects a drop of $100 million in revenue for the next three months due to the impacts of COVID-19.


An airport spokesman said it was "working cooperatively with Virgin's administrators to try to help the airline come through the current coronavirus crisis".

"Virgin has significant outstanding invoices from Perth Airport for airfield and terminal use charges - money the airline has already collected from its passengers and the FIFO sector," he said.

"While Perth Airport is working with the Virgin administrators, it also needs to protect its own interests.

"Perth Airport has taken liens over a number of Virgin aircraft - a standard practice in these situations.

"The aircraft affected are not being used for current FIFO or interstate operations and have been parked at Perth Airport for some time now.

"There will be zero impact on the State's resources sector.

"At this point in time, we continue to facilitate Virgin's FIFO flights through T2 while we try to secure an agreement with the administrators."

Virgin Australia, which went into administration this week, is continuing to fly about 180 mainly FIFO flights each week.

The airport said that "maintaining a two-airline system in Australia Post-COVID-19 is absolutely essential for the aviation and tourism sectors, and the broader economy."

Yesterday, company administrator Deloitte said that from its initial review of the airline's books and records, it appeared the Virgin companies had 10,247 creditors, including about 9,020 employees.

It noted that "this is likely to change as more information becomes available."

The administrators said they expect that the total number of creditors to be over 12,000.

On the initial review the debts total $6.90 billion and are made up of: lenders under secured corporate debt and aircraft financing facilities ($2.28 billion); unsecured bondholders ($1.99 billion); trade creditors ($167 million); aircraft lessors ($1.88 billion); landlords ($71 million); and employees ($451 million).

More than 10 groups have expressed interest in Virgin Australia. A creditors' meeting will be held next Thursday and at that meeting Deloitte is expected to be challenged. There is industry speculation that insolvency firm KordaMentha will attempt to replace Deloitte for the role of administrator and will carry the day if half of creditors agree.

KordaMentha started in 2001 with the bankruptcy of Ansett Airlines and sold assets to pay employees 96¢ in the JU dollar.

Virgin said it was aware of the situation and was working with the airport.

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