EconomyMarkets

Virgin Atlantic creditors to vote on $1.6 billion rescue plan By Reuters

© Reuters. FILE PHOTO: Outbreak of the coronavirus disease (COVID-19) in Manchester

LONDON (Reuters) – Virgin Atlantic’s creditors will vote on a 1.2 billion pound ($1.6 billion) rescue plan on Tuesday in a crucial test of the airline’s ability to survive in an industry devastated by the COVID-19 pandemic.

Virgin Atlantic agreed the deal with shareholders and creditors in July to secure its future beyond the coronavirus crisis.

The airline, which is 51% owned by Richard Branson’s Virgin Group and 49% by U.S. airline Delta (N:), said it remains confident in the restructuring plan and is on track to finalise its solvent recapitalisation in the first week of September.

Tuesday’s vote of affected trade creditors includes nearly 200 suppliers that the airline owes more than 50,000 pounds to. It needs 75% support of the overall outstanding value of money owed at a hearing at London’s High Court.

If successful, another UK court hearing will be held on Sept 2 to approve the plan, and a procedural hearing is scheduled for Sept 3 in the United States.

Should the creditors fail to support the plan, the judge can still rule that it is in their interests for it to go ahead.

Virgin Atlantic has had to close its base at London’s Gatwick Airport and cut more than 3,500 jobs to contend with the fallout from the COVID-19 pandemic, which has grounded planes and hammered demand for air travel.

Global airline body IATA has said that the industry will not return to pre-crisis levels until 2024.

Although the likes of Germany and the United States have given bailouts to major carriers, Virgin Atlantic agreed a private-only restructuring deal after Britain said state support would only be considered after all other avenues had been exhausted.

($1 = 0.7645 pounds)

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.


Source link

Show More

Related Articles

Leave a Reply

Your email address will not be published. Required fields are marked *

Back to top button
Close