Queensland has made good on its pledge to tip $200 million into the coffers of Virgin Australia in return for the airline keeping Brisbane as its base, and will also become a shareholder under new owners Bain Capital.
The state-owned Queensland Investment Corporation said the $200 million – first flagged as Project Maroon in the weeks following Virgin's collapse into administration with almost $7 billion of debt – would largely encompass loans to provide working capital, along with a range of financial incentives and subsidies.
This also includes an equity investment of around $20 million for what's suggested to be a 2% stake in Virgin Australia, and requires Virgin to keep its headquarters in Brisbane for the next 10 years.
Virgin has already abandoned its long-held Virgin Village hub at Bowen Hills and moved into five floors of more centrally-located Southpoint building at Southbank, which also serves as Flight Centre HQ.
US-based Bain Capital is on track to officially take ownership of the airline by the end of this month, largely by assuming outstanding debt in a $3.5 billion 'rescue and reboot' play which sees existing shareholders – including the likes of Singapore Airlines, Etihad Airways and Sir Richard Branson's Virgin Group – bundled out.
Queensland Treasurer Cameron Dick said "the return to the Queensland taxpayer on that ($200m) investment will be about 7% over the duration of that agreement."
"This airline was going into administration and may very well have collapsed," Dick added. "We stepped up to the plate and supported this airline."
"Without competition, monopoly pricing would have crushed regional Queensland and that’s what we wanted to avoid at all costs. We saw that when Ansett collapsed... the price was paid by regional Queenslanders."