SF Gate: Branson expects to offer 30 percent stake in Virgin Blue

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Thursday, May 15, 2003 (AP)
Branson expects to offer 30 percent stake in Virgin Blue



   (05-15) 12:20 PDT SYDNEY, Australia (AP) --
   British entrepreneur Richard Branson said he hopes to make 30 percent of
the stock of budget airline Virgin Blue available on the Australian stock
exchange before the end of the year.
   "As much as anything is definite, it is very likely that we will float
before the end of the year," Branson told reporters Thursday in the
southern city of Adelaide.
   Branson said 20 percent of the shares would come from the airline and 10
percent from Virgin Group Ltd. and Australian transport company Patrick
Ltd., which owns 50 percent of the carrier.
   His comments came after the company reported a pretax profit of 158
million Australian dollars ($102 million) for the fiscal year ended March
31, up from 47 million Australian dollars a year ago.
   Virgin Blue chief executive Brett Godfrey said the company's performance
demonstrated that its low-fare model could be successful at a time when
uncertainties like the war in Iraq, terrorism and SARS were hurting
traditional carriers.
   "The reality is however, that our business had been relatively well
insulated from those challenges," he said, without elaborating.
   Virgin Blue has carved out a strong low-cost niche in Australia's air
travel market since it moved into the country almost three years ago to
take on the two major Australian domestic carriers Qantas Airways and
Ansett Airlines on the main east coast routes.
   Ansett was placed into liquidation and grounded in 2001, allowing Virgin
to expand its services throughout the country on routes that would
previously have been difficult to muscle into.
   When Branson sold the 50 percent Virgin Blue stake to Patrick last March,
he kept the option to float up to 20 percent of the company's shares.

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Copyright 2003 AP

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