An increasingly cluttered share registry at Virgin Australia Holdings (VAH) has prompted at least one team of analysts to predict two of its airline shareholders will gang up on the third.
Etihad and Singapore Airlines are sitting at 19.9% and Air New Zealand has signalled it will move to 25.9% even as founder Richard Branson's Virgin Group is slowly selling down.
Etihad acquired a 2.7% stake in the Australian carrier from Virgin Group, whose stake has now fallen to 10%.
Analysts at Macquarie Private Wealth are predicting an earnings improvement at Virgin now that its "Game Change" transformational program is largely complete and say Air NZ's investment in the airline gives it exposure to the much bigger $10 billion Australian domestic market.
But they say the story is complicated by the involvement of the other airlines.
None of the airlines yet has a board seat -- the board still reflects the old shareholder structure -- but the Macquarie analysts note that a push by one shareholder will see all of them wanting to participate.
"Medium term, we suspect the future for Virgin is to be acquired by two of the three existing airline shareholders, with Singapore and Air NZ in our view the most likely combination due to overlapping strategic interest and the prospect of an improved relationship with each other," they said.
"But a tighter alliance between the two needs to occur first."
In good news for the investors after Virgin's loss last financial year, the analysts are predicting a more encouraging outlook for this year and fiscal 2015.
"We believe FY13 will represent a trough in Australian domestic industry earnings, which we estimate to be the lowest annual industry return since Ansett fell into bankruptcy in the early 2000s," they said.