This has been rumoured for years now and, after the first full year of profitability, they've finally decided to make the leap.
The airline has been an expensive venture to date but long-tail airlines are not cheap to build.
The filing comes after the airline reported its first annual profit since it was created in 2007. Virgin America recorded net income of $10.1 million in 2013, a vast improvement from the loss of $145.4 million reported a year earlier. Full-year operating revenue climbed to $1.4 billion from $1.3 billion. Virgin America said it recorded a loss of $22.4 million in the first quarter of 2014.
And it's certainly not a blockbuster IPO either, the filing indicates the value of the offer will be around US$115m, with the majority of the funds going to expansion ambitions and ongoing efforts to cement their position agains the constant pressure from the legacy carriers.
It will be interesting to see what the long-term strategy for the carrier is and what they can do to differentiate themselves once the novelty of their physical product has worn off, and their limited network and lack of alliance partnerships starts to become more of an issue.
I've criticised VX in the past for some bizarre decisions but, as a member of the team of that founded the airline, I obviously wish them continued success. I will watch this new chapter unfold with interest and optimism.
UPDATE: A commenter on Airliners.net pulled out some interesting tidbits from the SEC filing:
- Approximately 30% of guest in 2013 were on business travel - one of the highest in US industry.
- Actual cash on hand much higher than previously reported - $132.9mil as of end of Q1 with total capitalization of $365.5mil
- Currently only serve 15 of 50 top US metro area.
- 10 A320 aircraft are due between July 2015 - June 2016.
The current ownership of the company is: VAI Partners - 71.6% (primarily Cyrus Aviation Investor, LLC), VX Holdings - $22.1% (primarily Virgin Group), Rest various parties including employees and executives.
- The airline retains right of use of Virgin Group brand for 25-years following IPO with annual licensing fee. (extended from current 15-year agreement)
- Following IPO, Virgin Group will provide the airline with $100.0 million letter of credit facility, while Cyrus provides $50.0 million credit facility.
- Equity provided by Cyrus and Virgin Group since pre start up - $521.4mil