Affinity’s stake is expected to be worth well north of $750 million. It’s expected to be pitched as a strong cash generating arm, however its real value is in being able to make the most of the rewards program’s huge amounts of data.
Sources said Affinity was likely to wait for Velocity’s next earnings update – to be delivered as part of Virgin Australia’s half-year results in February – before launching anything publicly.
It would also be hoping for a prettier looking set of numbers than Virgin shareholders saw at the company’s full-year results last August. Velocity’s numbers were hit by the RBA’s changes to its credit card interchange regime. Velocity’s EBITDA was down 20.6 per cent to $117.1 million in the 2018 financial year, while EBIT was off 23 per cent to $110.1 million. Importantly, though, Velocity’s membership was up 14 per cent to 9.1 million members.
It would also make sense for Affinity to wait until Virgin Australia had finalised its chief executive officer appointment.
As Street Talk reported in December, former Hawaiian Airlines boss Mark Dunkerley was in the frame for the job. However it is understood there has been a late push for former DP World Australia chief executive Paul Scurrah, who finished up at the ports operator late last year.
Finally, it’s interesting to see Bank of America Merrill Lynch round out its hiring spree by nabbing former Flagstaff adviser Angus Barker to spearhead its advisory team in Melbourne. Barker is BAML’s sixth managing director hire in an attempted refresh that has stretched over the past 18-months, and is an important one given his ability to lead the Melbourne team.
It’s understood BAML has also picked up a couple of bankers at the vice president level; real estate banker Okan Kender from Lazard and Matt Chalmers from Nomura for natural resources. There’s expected to be a few more in the works in coming months.
from A Viral Update http://bit.ly/2FXsTdR
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