News: VAH UPDATE 1-Virgin Australia creditors approve airline's purchase by Bain Capital -union

• Deal will give unsecured creditors return of 9-13%
• Virgin plans to cut one-third of its workforce
• Airline had entered voluntary administration in April

(Adds details of return to creditors)

SYDNEY, Sept 4 (Reuters) - Virgin Australia Holdings Ltd's (VAH) creditors on Friday approved the purchase of Australia's second-biggest airline by U.S. private equity group Bain Capital, according to a statement from the Transport Workers' Union.

The union, representing some of Virgin's 9,000 employees, said it welcomed approval of the deal, which will allow the carrier to exit voluntary administration.

A Virgin spokesman did not respond immediately to a request for comment.

Virgin entered administration in April owing A$7 billion ($5.1 billion) to creditors after suffering from a sharp plunge in demand because of the coronavirus pandemic.

The Bain deal will give unsecured creditors a return of 9% to 13% of their investment and involves a financial commitment of A$3.5 billion, according to administrator Deloitte.

Under Bain's business plan, Virgin plans to cut a third of its workforce as part of an overhaul to focus on being a domestic and short-haul international Boeing Co BA.N 737 operator competing against Qantas Airways Ltd (QAN) .

($1 = 1.3765 Australian dollars)