This archive report was first published on 15 July 2020.
Published on July 15, 2020, Virgin Atlantic has secured a £1.2 billion rescue package over the next 18 months, with the funds coming solely from private investors.
The airline's rescue package includes £200 million from Sir Richard Branson's Virgin Group, £170 million from US hedge fund Davidson Kempner Capital Management, and the postponement of about £450 million in payments to creditors, including Virgin Group and Delta Air Lines.
Virgin Atlantic also expects to generate a further £280 million through cost savings, which will help the airline cover the next five years and return to profitability in 2022.
However, the deal must secure approval from relevant creditors through a process introduced as part of Government reforms to corporate restructurings.
Virgin Atlantic's struggles come as the aviation industry continues to grapple with the impact of the COVID-19 pandemic, which has led to a significant slump in international travel.
Earlier this year, Virgin Australia entered into voluntary administration in a bid to recapitalize the business, but failed to secure $1.4 billion in funding from the Australian government.
