News: QAN UPDATE 1-Virgin Australia suspends trading as talks over rescue package remain incomplete

(Adds comments from Treasurer, details from source)

SYDNEY, April 16 (Reuters) - Cash-strapped Virgin Australia Holdings Ltd (VAH) on Thursday suspended trading in its shares to continue talks on financial aid and restructuring alternatives to help it weather the coronavirus crisis.

The country's second-biggest airline had halted trading on Tuesday but said in an update on Thursday that discussions remained confidential and incomplete and requested a suspension of trading for up to seven days.

Virgin has so far been unsuccessful in its request to the Australian government for A$1.4 billion ($883.54 million) in loans that could convert to equity under certain circumstances.

"We want to see two airlines in the domestic market but we're not in the business of owning an airline," Australian Treasurer Josh Frydenberg said on television network Nine on Thursday.

The opposition Labor Party supports a government lifeline to Virgin, which is more than 90% foreign owned and competes against Qantas Airways Ltd (QAN) .

Virgin is also in talks with creditors about debt restructuring options such as a debt-for-equity swap and has hired UBS, Morgan Stanley, Houlihan Lokey and Deloitte as advisers, according to a person with knowledge of the matter who was not authorised to speak publicly.

Entering voluntary administration is a last resort but the airline believes it needs a decision on government aid by next week, the person said. ($1 = 1.5845 Australian dollars)