Reports: Virgin America is seeking a buyer – USA TODAY

7 months ago Comments Off on Reports: Virgin America is seeking a buyer – USA TODAY

Less than two years after going public, Virgin America may be looking for a buyer.

Bloomberg reported Wednesday that the Burlingame, Calif.-based carrier is putting out feelers regarding a potential sale. Citing sources familiar with the queries, Bloomberg said Virgin America might entertain selling the entire airline or just a segment of the company – or ultimately not seek to sell at all.

Virgin America said in an email that “as a public company, we have a policy of not commenting on any market or media speculation concerning mergers or acquisitions.”

Backed by British billionaire Richard Branson who has a minority stake, Virgin America went public in November, 2014. Since launching in 2007, the airline has become known for its mood lighting, sleek cabins and in-flight entertainment, regularly topping industry and consumer surveys.

But Virgin America didn’t begin to steadily post profits until 2013.  And at least one analyst says that there are many hurdles that would likely prevent another airline from making a bid for the carrier.

“While information is limited at this point, we do not believe another airline would be the logical buyer of the company given the current regulatory environment, Virgin’s lack of aircraft ownership or dominant slot holdings, among other factors,” wrote Jamie Baker of J.P. Morgan in an investors note. “While we’ll probably know more in coming days, we are confident for now that the wheels of consolidation remain halted. More likely, in our view, is some sort of private equity or travel-related/non-airline entity,”

Despite fierce competition with American Airlines and Southwest in Dallas, Virgin America saw a $190.9 million profit in the fourth quarter of 2015, a significant jump from the $3.9 million reaped during that period the previous year.

Reports: Virgin America is seeking a buyer – USA TODAY

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