Reuters Insider - Asia Insight: Virgin Australia rescued by Bain Capital, many job losses seen
26/06/2020 09:30
Click the following link to watch video: https://share.insider.thomsonreuters.com/link?entryId=1_s9n3s2fj&referenceId=1_s9n3s2fj&pageId=ReutersNews Source: Reuters Insider Description: U.S. private equity group Bain Capital has agreed with the administrator of Virgin Australia to buy the country's second-biggest airline for an undisclosed sum, banking on an aviation industry recovery. But as many as 3,000 of its 9,000 workforce may be axed. Short Link: https://refini.tv/2NtvygX Video Transcript: Australia’s second largest airline Virgin Australia has been bought by private equity group Bain Capital. Deloitte, which handled the sale, says the deal would provide a significant capital injection into the ailing carrier. Virgin Australia entered into administration in April with debts of nearly $5 billion. As many as 3,000 of its 9,000 staff are expected to made redundant. To the economy where Japan remains close to deflation. Core consumer prices in Tokyo rose by just 0.2% in June, that’s well below the government’s target of 2%. Inflation has been below target for around 25 years, and the central bank has all but given up on getting it back to its optimum rate. Asian stock markets grind higher but is set to end a choppy week with only slight gains. Surging coronavirus infections have cast a shadow over encouraging economic data and checked hopes for a swift global recovery. Shane Oliver at AMP Capital in Sydney says the market’s faced a lot more downside risk. Mainland China’s markets remain closed for the Dragon Boat Festival holiday. Oil prices also crept higher on optimism about recovering fuel demand worldwide. Analysts say satellite data showing strong pick-up in traffic in China, Europe, and across the United States point to a recovery. Michael McCarthy, chief market strategist at CMC Markets, says it does appear the market is ignoring supply and demand fundamentals and moving on sentiment. Australia has deployed troops to help it contain a new outbreak of the coronavirus. 1,000 soldiers have arrived in the State of Victoria where the latest cases have bene reported. The state has now recorded 10-straight days of double-digit COVID-19 infections. Nevertheless, the federal government is pushing ahead with plans to further ease the lockdowns. Australia’s performance is remarkable and that is attribute to all who are involved. Certainly, of course, we have some challenges in Victoria at the moment, but I think that does put it in perspective. We remain on track. The curve remains flat. But when you get bumps and when you get outbreaks, then you need to manage them, and you need to respond to them, and that is exactly what is happening. India is opening up its state-run space program to private companies. The move is a bid to boost the sector which India is trying to build as an alternative to the US, China, and Russia. Private firms would be allowed to build rockets, launch satellites, and provide commercial services to the industry. Let’s take a look at some companies in the news and Huawei is to spend $1.2 billion on setting up a research center in the UK. It will employ around 400 people in the facility near Cambridge. Huawei’s Vice President Victor Zhang said the UK’s home to a vibrant open market and has some of the best talent in the world. Australia’s Westpac Bank has won an appeal against charges that it broke the law when determining whether customers could afford mortgages. An appeals court ruled that the bank did nothing wrong by using an automated system rather than manually checking each applicant’s living expenses. Pakistan’s National Airline is to suspend a third of its pilots because they may have cheated in their exams. The decision comes amid an inquiry into crash that killed 97 people in May. The country’s aviation minister says the pilots of the A320 jet had failed to follow proper procedures. Millions of dollars of oil storing tanks and ships in Asia and Europe has become caught in a web of lawsuits related to trade and financing deals by Singapore’s Hin Leong. Court documents, retrieved by Reuters, show that the company, one of the world’s largest oil traders, acquired financing for cargos that did not exist. Accountancy firm PwC says creditors are likely to file multiple claims against the firm. And finally, Australia and New Zealand have won the right to host the Women’s World Cup at 2023. The joint bidders shore up a rival bid by Colombia, but the governing body FIFA has said the offer from the two nations provide a commercially successful tournament