Patrick Corporation and Virgin Blue are pleased to announce Patrick has signed an agreement to acquire a 50% shareholding in Virgin Blue, Australiaå‘s only low fare airline.

Following discussions to vary the previous agreement between the parties announced 26th November 2001, Patrick Corporation will pay $260million for its shareholding. Depending on capital requirements, which are yet to be determined, part of this payment may be for new capital for Virgin Blue and the balance as consideration for existing shares.

A further consideration may be payable dependent upon the performance of the Company over the next three years.

The arrangements are subject only to achieving a shareholders’ agreement.

With the backing of one of Australia’s most respected organisations, allied with what is now one of Australia’s most recognised brands, Virgin Blue can now cement its position as the nation’s leading domestic airline based on a low fare operating model.

It is also leading the market in terms of on time performance, customer service and employee satisfaction. The agreement with Patrick Corporation, will also allow the company, by being a truly Australian owned airline, to operate international routes in the future should it wish to do so.

Virgin Blue, together with Patrick Corporation, now has the financial strength to actively pursue in its own right the opportunities arising from the Administration of Ansett.

Sir Richard Branson, who will be Chairman of Virgin Blue, commented, Patrick Corporation is the ideal partner for Virgin Blue in Australia. I have a great deal of respect for both Chris Corrigan and the company which has been one of the most innovative in the Asia Pacific region.

They clearly bring a very strong transport and logistics expertise into the business, and a business reputation that is second to none. I am greatly looking forward to working with both Patrick Corporation and the team at Virgin Blue to build an even stronger airline that Australia can continue to be proud of.

Chris Corrigan, Managing Director of Patrick Corporation added, Virgin Blue has changed the face of Australian aviation by bringing friendly, efficient and low cost service to the Australian public. It has great staff and a very strong management team. Having watched it grow from 2 planes to 16 in only 20 months, I have every confidence in the exciting plans to continue the expansion of the business.

I look forward to working with Sir Richard and his team and I look forward to an exciting partnership together.

Virgin Blue currently operates 16 aircraft with a further 7 scheduled for delivery during 2002. The company currently employs nearly 1500 people and flies to all Australian States and Territories. The company became profitable shortly after its inception and continues to be one of the few start-up carriers in the world to achieve this goal within its first year.

In a remarkably short time Virgin Blue has become an icon in the Australian aviation market.

The strength of Virgin Blue’s brand proposition was underlined this week by Interbrand’s Brand of the Year Survey 2001, which not only put Virgin itself in the top 12 global brands, but listed Virgin Blue as one of the top 10 brands in the whole of the Asia Pacific region only a little more than a year after it first launched. It is the only Australian airline to be included on this list.

Goldman Sachs acted as financial advisor to the Virgin Group and Virgin Blue.

——-