Virgin Atlantic Agrees to Rescue Package
Posted on 07/14/2020
Virgin Atlantic airline (Virgin Atlantic Airways Limited) is 51% owned by billionaire Richard Branson’s Virgin Group and 49% by Delta Air Lines, Inc. Virgin Atlantic agreed to an emergency rescue deal with its shareholders and creditors worth 1.2 billion pounds. Hedge fund Davidson Kempner Capital Management LP will provide 170 million pounds in secured funding. Virgin Group plans to inject 200 million pounds.
The deal involves private parties and removes the need for government support. Globally, airlines have been massively impacted by the Wuhan coronavirus pandemic (COVID-19). In addition, the airlines was issuing customer refunds at a super slow pace that helped the airline preserve cash during COVID-19.
“The last six months have been the toughest we have faced in our 36-year history. We have taken painful measures, but we have accomplished what many thought impossible,” Virgin Atlantic Chief Executive Shai Weiss said in a statement.
“We greatly appreciate the support of our shareholders, creditors and new private investors and, together, we will ensure that Virgin Atlantic can emerge a sustainably profitable airline with a healthy balance sheet.”
