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A380MSN004
Topic Author
Posts: 731
Joined: Sat Jun 03, 2017 9:07 am

Investment firms / Airlines

Fri Jul 03, 2020 2:12 pm

Hi guys,

I recently noticed that Bain Capital investment firm bought Virgin Australia. They were fighting against Cyrus Capital Partners.
Obviously those two firms showed up when Virgin Australia finances were distressed.

I would like to know if anyone here has an idea of the investment strategy/preferences of these investment funds?

Do they intervene rather at Seed Money step? Series A / B / C... Or do they prefer to show up when an airline is in difficulty like Virgin Australia for example.

Thanks for your feedbacks.

A380MSN004
 
MIflyer12
Posts: 7770
Joined: Mon Feb 18, 2013 11:58 pm

Re: Investment firms / Airlines

Fri Jul 03, 2020 2:28 pm

I don't think you'll be able to infer much on Bain's passenger carrier strategy from its list of portfolio companies.

https://www.baincapitalprivateequity.co ... -companies
 
User avatar
cirrusdragoon
Posts: 182
Joined: Thu Feb 22, 2018 6:42 pm

Re: Investment firms / Airlines

Fri Jul 03, 2020 7:44 pm

A380MSN004 wrote:
Hi guys,

I recently noticed that Bain Capital investment firm bought Virgin Australia. They were fighting against Cyrus Capital Partners.
Obviously those two firms showed up when Virgin Australia finances were distressed.

I would like to know if anyone here has an idea of the investment strategy/preferences of these investment funds?

Do they intervene rather at Seed Money step? Series A / B / C... Or do they prefer to show up when an airline is in difficulty like Virgin Australia for example.

Thanks for your feedbacks.

A380MSN004


Cyrus Capital Partners investment process is driven by seeking leveraged and financially distressed companies They identify and exploit inefficiencies in the leveraged and distressed debt and leveraged equities markets.

On the other side of the spectrum , Bain Capital , which likes to pursue investments in a wide variety of industries. They are fined tuned towards healthcare, industrial, consumer and retail and financial services sectors. Transactions may involve venture/expansion capital for public companies, industry consolidation or management buy outs, also various types of financing will be considered including public/private equity and mezzanine debt. In 2013, Bain Capital was one of three venture capital firms to commit funds to SigFig ( a San Francisco-based robo-advisor and wealth management solution that seeks to change the retail investment industry) in a $15 million Series B funding round just as an example of one of their type of investments.
 
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FLALEFTY
Posts: 729
Joined: Tue Jan 31, 2006 11:33 am

Re: Investment firms / Airlines

Fri Jul 03, 2020 10:02 pm

cirrusdragoon wrote:
A380MSN004 wrote:
Hi guys,

I recently noticed that Bain Capital investment firm bought Virgin Australia. They were fighting against Cyrus Capital Partners.
Obviously those two firms showed up when Virgin Australia finances were distressed.

I would like to know if anyone here has an idea of the investment strategy/preferences of these investment funds?

Do they intervene rather at Seed Money step? Series A / B / C... Or do they prefer to show up when an airline is in difficulty like Virgin Australia for example.

Thanks for your feedbacks.

A380MSN004


Cyrus Capital Partners investment process is driven by seeking leveraged and financially distressed companies They identify and exploit inefficiencies in the leveraged and distressed debt and leveraged equities markets.

On the other side of the spectrum , Bain Capital , which likes to pursue investments in a wide variety of industries. They are fined tuned towards healthcare, industrial, consumer and retail and financial services sectors. Transactions may involve venture/expansion capital for public companies, industry consolidation or management buy outs, also various types of financing will be considered including public/private equity and mezzanine debt. In 2013, Bain Capital was one of three venture capital firms to commit funds to SigFig ( a San Francisco-based robo-advisor and wealth management solution that seeks to change the retail investment industry) in a $15 million Series B funding round just as an example of one of their type of investments.


It looks like Bain Capital (the proverbial "dog") has "caught the car" by offering to buy Virgin Australia. Bain's proposed recovery plan seems to focus on domestic and regional services, so it might be the end of the line for their long-haul B77W fleet?

I wish them well...

https://www.cnn.com/2020/06/25/business ... index.html
 
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cirrusdragoon
Posts: 182
Joined: Thu Feb 22, 2018 6:42 pm

Re: Investment firms / Airlines

Fri Jul 03, 2020 10:07 pm

FLALEFTY wrote:
cirrusdragoon wrote:
A380MSN004 wrote:
Hi guys,

I recently noticed that Bain Capital investment firm bought Virgin Australia. They were fighting against Cyrus Capital Partners.
Obviously those two firms showed up when Virgin Australia finances were distressed.

I would like to know if anyone here has an idea of the investment strategy/preferences of these investment funds?

Do they intervene rather at Seed Money step? Series A / B / C... Or do they prefer to show up when an airline is in difficulty like Virgin Australia for example.

Thanks for your feedbacks.

A380MSN004


Cyrus Capital Partners investment process is driven by seeking leveraged and financially distressed companies They identify and exploit inefficiencies in the leveraged and distressed debt and leveraged equities markets.

On the other side of the spectrum , Bain Capital , which likes to pursue investments in a wide variety of industries. They are fined tuned towards healthcare, industrial, consumer and retail and financial services sectors. Transactions may involve venture/expansion capital for public companies, industry consolidation or management buy outs, also various types of financing will be considered including public/private equity and mezzanine debt. In 2013, Bain Capital was one of three venture capital firms to commit funds to SigFig ( a San Francisco-based robo-advisor and wealth management solution that seeks to change the retail investment industry) in a $15 million Series B funding round just as an example of one of their type of investments.


It looks like Bain Capital (the proverbial "dog") has "caught the car" by offering to buy Virgin Australia. Bain's proposed recovery plan seems to focus on domestic and regional services, so it might be the end of the line for their long-haul B77W fleet.

I wish them well...

https://www.cnn.com/2020/06/25/business ... index.html


Indeed , any loss making enterprises need to be leaned out. This will only make the company stronger, and perhaps one day they will return to the international skies.
 
A380MSN004
Topic Author
Posts: 731
Joined: Sat Jun 03, 2017 9:07 am

Re: Investment firms / Airlines

Sat Jul 04, 2020 10:24 pm

Thanks for your feedbacks.

To add more datas in this topic, for starting Volotea (V7) back in 2011 Carlos Munoz and his team manage to raise 35M€ via the following investment funds :
Corpfin
CCMP
Axis Participaciones

That's a huge amount of money for a "Seed"
 
bfitzflyer
Posts: 383
Joined: Mon Nov 07, 2016 1:02 am

Re: Investment firms / Airlines

Sat Jul 04, 2020 11:19 pm

Texas Pacific Group, bought out Continental in 1993 and later in 2007 Midwest Express. For Midwest allowed them to not be taken over by Airtran. With Continental, probably started them on the road to success they had in 90's/00's.
 
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Channex757
Posts: 2394
Joined: Sat Jun 18, 2016 7:07 am

Re: Investment firms / Airlines

Sun Jul 05, 2020 12:19 am

These funds basically come in on companies who are struggling under a ton of debt. They then arrange new financing via several methods, which improves the company and its credit ratings.

The airline can then be sold on later with debts at a lower interest rating. As a part of all this can be a process of cost saving and also selling off any assets left unencumbered.

Horrendously oversimplified but it's a regular process; using the money of the trust to tidy up the finances of the airline and turn a profit.
 
VS11
Posts: 1655
Joined: Mon Jul 02, 2001 6:34 am

Re: Investment firms / Airlines

Sun Jul 05, 2020 12:32 pm

A380MSN004 wrote:
Hi guys,

I recently noticed that Bain Capital investment firm bought Virgin Australia. They were fighting against Cyrus Capital Partners.
Obviously those two firms showed up when Virgin Australia finances were distressed.

I would like to know if anyone here has an idea of the investment strategy/preferences of these investment funds?

Do they intervene rather at Seed Money step? Series A / B / C... Or do they prefer to show up when an airline is in difficulty like Virgin Australia for example.

Thanks for your feedbacks.

A380MSN004


They could be and most likely are pursuing more than one strategy at the same time. Bain Capital has funds that are venture oriented (early stage), credit funds, buy-out and others. They can all come in and participate in the capital structure of the firm - some will be owners, others will be lenders so they are double-dipping in a way. :-)

Also, both these firms already have experience working with Virgin and SRB. Cyrus was an investor in Virgin America and Bain Capital is an investor in Virgin Voyages.

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