Virgin Australia has entered into voluntary administration, making it the first major Australian corporation that has folded because of the coronavirus pandemic.
The move has put 16,000 jobs at risk.
Australia's Federal Government reportedly rejected the airline’s repeated requests for an emergency bailout, after the airline, which was already struggling with £2.5billion of debt, had to cancel almost all of its flights during the ongoing coronavirus outbreak.
Last week, Virgin Australia, which is 25 per cent owned by Richard Branson's Virgin Group, with other investors including Etihad, also suspended trading in its shares on the Australian stock exchange.
The airline services domestic and short-haul international destinations, and was founded in 2000 by Branson. It is one of Australia's main aviation providers.
‘A stronger financial position’
The airline said in a statement to the Australian Stock Exchange: "Virgin Australia has entered voluntary administration to recapitalise the business and help ensure it emerges in a stronger financial position on the other side of the Covid-19 crisis.”
The move follows a board meeting of the firm's international shareholders who voted against providing more financial support.
‘In most countries federal governments have stepped in’
Following the news, in a letter to employees posted on Twitter, Branson said: "I am so proud of all of you and everything we have achieved together.
"20 years ago, we wanted to bring much needed competition to Australia’s skies, to lower airfares, to give customers choice, to create thousands of jobs and to put a smile on people’s faces.
Originally, the airline began as Virgin Blue, before growing into Virgin Australia.
Branson added: "I know how devastating the news today will be to you all.”
"In most countries federal governments have stepped in, in this unprecedented crisis for aviation, to help their airlines. Sadly, that has not happened in Australia.
"This is not the end for Virgin Australia and its unique culture.
"Never one to give up, I want to assure all of you - and our competitor - that we are determined to see Virgin Australia back up and running soon.
Branson explained that they intend to “work with Virgin Australia’s administrators and management team, with investors and with government” in order to make this happen.
"Virgin Australia has captured the hearts of Australians. That is down to all of you - past and present - who made it the best airline to fly within Australia,” adds Branson.
"This is not the end for Virgin Australia, but I believe a new beginning.
"I promise that we will work day and night to turn this into reality.”
Virgin Australia's board has appointed Deloitte as voluntary administrators.