Five major shareholders of Virgin Australia Aviation company is mentioned as follows-
Voluntary administration when the bosses of insolvent organizations hire an extrinsic administrator for investigating that winding up of an enterprise can be protected or delayed. Along with this, suggest the directors as well as creditors whether the firm has to enter into a deed of an association or not. For example; Virgin aviation company in Australia is appointing the government as an administrator for voluntary actions via court proceedings in order to prevent the firm as well as its position as much as possible. Simply, the main reason behind designing a voluntary administration is to resolve the issues related to firm future direction instantly (Borenstein & Rose, 2014).
a) Virgin Australia Holdings Ltd. has become a foremost aviation company which has failed due to COVID-19 after the epidemic disadvantaged of debt-burdened organization in every income level. Administrators at Deloitte has acquired the control of Brisbane based carrier is having an objective to restructure the business and tries to identify the new entrepreneurs within the months. As a result, Deloitte administrator or shareholder has found that almost 10 parties are interested in the business (Singh, Pangarkar & Heracleous, 2014). Furthermore, Virgin Australia has joined FlyBe which is the largest domestic aviation company of the UK before it distorted in the previous month amongst the sector causations due to the virus. In fact, carriers are beaten by local as well as global traveling bans which enforce the company to acquire the support of Australian governing bodies (Angus Whitley, 2020). Additionally, Vaughan Strawbridge which is one of the four administrators at Deloitte stated that carrier destiny is going to clear in the next two-three months. Therefore, he hadn’t made any strategy for reforming the operational activities of Virgin Australia neither wanted to fire any employee. A company can gain the best results wherever it can sell the firm as a whole so it’s a suitable approach because numerous parties are having potentiality to become a part of restructuring (Tribe, 2015).
b) According to the scenario, Virgin Australia is having more than A$5billion as a debt at the end of 2019 and somehow hung in a balance after stopping the distinct services due to the COVID-19 as well as its request for state support is failed. As a result, Virgin Australia is demanding help from governing bodies of almost A$1.4 billion loan. Unexpectedly, the government has refused the request of the company of last A$200 million. At the same time, other shareholders are also rejecting to support the company such as; Etihad mentioned it is not easy to give additional capital support to Virgin Australia due to which firm requisite to deal itself with the terrible influence of the virus (Whyte & Lohmann, 2016). On the other hand, U.S governing bodies and overall Europe have stepped in for supporting the company as well as Ministers frequently stated that their objective is to have dual competing aviation in the Australian market. Along with this, Nicholas Moore which is a former CEO of Macquarie Group Limited involved with the voluntary administrator on the behalf of governing bodies of Australia for identifying a “market-led solution” to resolve the cases of Virgin (Clark, 2016).
c) At the initial stage, government officials have rejected supporting Virgin Australia because the condition of the company is becoming too worsen which shows the Autocratic leadership style of government. As per the autocratic style, the government is becoming too much controlling and using their powers instead of supporting the organization. But furthermore, the government has decided to help Virgin Australia in order to overcome the problem of the Airline Industry in the Australian market. Therefore, it shows that the government is now following the supportive style of leadership and authoritative in which advisory bodies are aware that what they are going to do or why (Craig Platt, 2020).
a) Virgin brand is considering as synonymous with Richard Branson who is a founder of Virgin Group from 1970 and he is known as an enthusiastic billionaire because he had made his initial millions via music label Virgin Records. Mr. Branson has called for personally stumping the money and bail out the entire company but instead of giving support, Branson was concentrating in warning about the outcome of monopoly due to the Australian skies. Ultimately, Branson is demanding support from governing bodies to get involved in the problem of the Virgin Group. Along with this, want to acquire help for his luxury Caribbean island resorts as insurance in a proposal from the British government. As soon as the announcement of voluntary administration for Virgin Group then Mr. Branson who is a leader of a company is stating the staff members of Australian that they should never give up. Moreover, he also wrote that in this major issue of coronavirus, the government of every nation is stepping in and giving full support to the aviation industry in this unprecedented disaster which helps companies to exist in this drastic trauma but it is not happening in Australia (Eaton, 2017).
This response of Mr. Branson is justifiable because he owned only 10.42% of an organization which means that nearly $5 billion financial support to Virgin Australia is not enough for pulling it out from debt and neither Branson is going to recover his return on the personal initial investment. Therefore, acquiring support from the British Government is the best initiative that is taken by Branson because governing bodies are responsible to support the entire industry in this catastrophic phase. In fact, it’s a responsibility of the Australian government to take steps for supporting the sector for gaining further income as a national economic development because the situation is not going to same permanently as it will surely be going to change (Gleeson, 2012).
b) Virgin Australia is owning 90% by offshore aviation which incorporates Etihad Airways, Singapore Airlines, Nanshan Group, HNA Group, and Mr. Branson Virgin Group. Every company is going through cash flow challenges due to the dangerous coronavirus pandemic. As a result, the overall liabilities of Virgin Australia is exceeding the assets of an organization by almost $1.6 billion which shows that now a company is worthless for shareholders. However, there are distinct types of leadership behavior which are followed by several leaders but Branson has adopted the supportive and participative style of leading by getting involved with the company. As per the supportive mode, leaders are having potentiality to assist individuals, team members, and the company to attain set targets or objectives just like Mr. Branson is involved in Virgin Australia to provide support to Virgin Australia. Along with this, appoint the government as a voluntary administrative for gaining financial help in order to reduce the probabilities of business collapsed (Latemore, 2013).
Supportive managers are engaged in continuous balancing initiatives such as; offering assistance or care of the required team, maintaining a professional level of distance as well as a discipline like Branson has supported the team of Virgin Australia by sharing a statement that they should never give up. It means that staff members requisite to struggle with the existing circumstance and make efforts to overcome the problem of COVID-19 through suitable initiatives (Lauren Roberts, 2020).
a) According to the note of Richard Branson, (2020), he stated that company is working with various groups of organizations day and night for protecting the jobs of Virgin people as a firm is encountering a major problem due to pandemic. Although, the firm is operating in multiple hardest-hit industries which incorporates; aviation, leisure, hotel, and cruises by having approximately 70,000 individuals or more than that who were working in nearly 35 nations in Virgin organizations (Littlechild, 2012). In fact, all the CEO of hotels are performing to maintain those businesses floating in this sinking environment, and Branson is thankful to all the employee’s whosever are continuing or still connected with the enterprise. Moreover, the entire team is dedicated almost a quarter of a billion dollars for supporting the businesses as well as preventing jobs of millions of employees and continuing to invest in the firm. Significantly, a major passion of Branson is to shape the businesses for enhancing the lives of common people, and the company has succeeded in creating hundreds of jobs from the last several decades. Therefore, Branson said that the maximum range of cash which is invested in the Virgin Group and various other companies is his wealth across the globe for preventing multiple jobs as much as possible (Lück & Gross, 2013). At the same time, employees of Virgin Atlantic have decided to conduct a reduction in their wages for almost eight weeks which is going to continue till six and a half months. It’s a unanimous decision of employees and unions who has collaboratively selected this option for saving the jobs as this was not forced by the management team. Furthermore, the company is also feeling proud of the teams who have continued to give crucial medical freight voyages to the UK and various people of Virgin Atlantic are volunteering working with NHS. This spirit of various leaders is tremendously heart-warming and motivating others towards efforts to easily come out from this problem (Mills, 2016).
b) According to the current situation, the supportive and participative leadership style is expected by hotel leaders for resolving the problem of Virgin Australia. In fact, Branson is taking several initiatives as well as employees of the company too for overcoming the collapsed issue by getting involved in a situation. Therefore, the supportive behaviour of hotel leader’s aids in controlling the circumstance because this phase can also be going to change as negative time surely converts into positive. Thus, collaborative behaviour plays a major role in these kinds of situations which automatically reduce the probabilities of the entire collapse of Virgin Atlantic (Sarina & Lansbury, 2013).
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