Aviation

Virgin Australia boss Paul Scurrah to exit, replacement revealed

Numerous reports of Paul Scurrah’s imminent departure from Virgin Australia have finally been confirmed, as the embattled airline prepares to emerge from administration under new ownership.

Despite backing Scurrah to continue leading Virgin as its CEO and managing director ever since it was picked by the administrators to take over Australia’s second-largest carrier, it appears Bain Capital has had a change of heart.

Scurrah, who joined Virgin in March last year, will step down from his role upon completion of the airline’s sale to Bain, which is expected to happen in early November.

Joint administrator Vaughan Strawbridge said Scurrah has done “an outstanding job” supporting he and his team of fellow administrators through the process.

“His exceptional leadership enabled us to stabilise the business and achieve a sale in a timely and orderly manner,” Strawbridge said.

“It is a testament to his leadership that we have been able to complete this sale and the business is well-positioned to play its vital role in the rebuilding of the Australian aviation industry and economy more broadly.”

Bain managing director Mike Murphy said: “Paul has provided the leadership to enable Virgin Australia to emerge from voluntary administration as a well-capitalised, best-in-class carrier.

“His personal commitment and determination to lead Virgin Australia through such a turbulent period is a credit to him.”

Scurrah said he made the decision to step down after some “long discussions” with his family.

“The time feels right, and I know the business will be in good hands,” he said.

“I am proud of that work that has been completed to date to transition the business and remove complexity, allowing the airline to compete effectively once demand returns.

“I want to thank all of our team members who have continued to support and work tirelessly to get the company through to this stage. I will forever be proud of what we have done here. It is the people that make this airline the great place it is, and I wish them all the best.

“I was extremely humbled by the warmth with which I was embraced on day one and for the unwavering support afforded to me throughout this ongoing major industry crisis.”

Scurrah also thanked Strawbridge and his team at Deloitte, as well as Virgin’s legal and financial advisers, for their efforts to ensure the airline’s future.

“I won’t forget the support they provided me and the team,” he said.

“I have also appreciated working with Bain Capital in recent months and recognise the significant contribution they have made to Virgin Australia’s long-term future. They have demonstrated a deep understanding of aviation and our culture.”

Scurrah revealed that former Jetstar CEO and Bain executive Jayne Hrdlicka, who was pivotal in the private equity firm’s bid, will take over in the top role at Virgin once the sale is completed.

“Jayne has strong aviation credentials. She is very focused on seeing the business succeed and I wish Virgin Australia well under her leadership,” he said.

Jayne Hrdlicka

The Transport Workers’ Union suspended negotiations on new enterprise agreements at the airline soon after reports emerged of Scurrah’s planned exit, and wrote to Bain seeking confirmation about changes at the airline and to the federal government appealing again for it to protect jobs at Virgin.

Strawbridge acknowledged speculation about the future shape of the airline, and said he had reaffirmed with Bain that Virgin will not be repositioned as a low-cost carrier.

“Virgin Australia will be a ‘hybrid’ airline, offering great value to customers by delivering a distinctive Virgin experience at competitive prices,” Strawbridge said.

“This will appeal to the full spectrum of travellers, from premium corporate through to more budget-focused customers.”

TWU national secretary Michael Kaine said the joint administrator’s statement today was “encouraging”.

“This is an important step forward, but we still have serious concerns about the future of Virgin,” he said.

“The statement makes no mention of previous commitments to regional routes, the international division, 6,000 jobs or fleet numbers.

“We are seeking a meeting with Bain Capital to discuss these issues and our delegates will decide in the coming days about the future of industrial talks with the airline.

“We sincerely hope that the veil of secrecy and background shenanigans on display over the past few days is not repeated. Trust must be at the heart of Bain’s dealings.”

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