There'll be a lot of suicides and other long term mental...

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getluv

55 Posts.

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08/04/20

01:18

Post #: 43939267
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Originally posted by Artvandelay01: ↑

Can history teach us anything? I stumbled onto this article and thought it was worth a share:

https://australianaviation.com.au/2019/09/from-the-archives-the-ansett-collapse/

I was in my early teens when Ansett collapsed so wasn’t really aware of the extent of the fall out. It’s sobering though to read that 30 Ansett employees committed suicide in connection with the collapse, especially when taking into account Australia’s current death toll of 48 people due to COVID-19 (see also: https://www.theage.com.au/national/hidden-toll-of-ansetts-collapse-20041114-gdyzpd.html)

I’ve been through a VA process myself, and it was really messy and expensive although it did save the business and most employees retained their jobs. However, Virgin is an order of magnitude larger, and the market dynamic is much more complex so I don’t think that is the right approach here. Nor do I think the Australian government should subsidise a company with a track record of poor management and wealth destruction. If existing shareholders and debt holders are unwilling to recapitalise the business, then I’d be supportive of the Australian government providing a senior secured loan on the basis that the debt holders agree to convert their debt into equity and/or take a significant hair cut to remove the company’s debt burden. Absent significant changes to the company’s capital structure, any government support is only likely to kick the can down the road.

All IMO - DYOR etc

Cheers

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There'll be a lot of suicides and other long term mental heath cases affecting people in all industries.

I'm sorry, but Virgin isn't a special case. This tells me the Government should be spending the $1.4B on mental health services and not on propping up a business that was barely holding it together even before the crisis.

Last edited by getluv: 08/04/20

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0 Great analysis

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