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Virgin Atlantic is saved from the brink of collapse in London’s High Court
Virgin Atlantic has been rescued from the brink of bankruptcy after its creditors voted in favour of a £1.2bn rescue deal.
The airline said it had won the ‘overwhelming support’ of its 170 creditors who agreed to a complex restructuring plan in the High Court yesterday.
Of its trade creditors, the airline said 99% were in agreement.
Virgin Atlantic called the vote a ‘significant milestone’ in safeguarding its future. "Achieving this milestone puts Virgin Atlantic in a position to rebuild its balance sheet, restore customer confidence and welcome passengers back to the skies as soon as they are ready to travel," it said in a statement.
The airline had previously warned it would run out of cash before the end of September if its creditors didn’t approve the rescue package.
But creditors agreed today to waive 20% of what they’re owed, with the rest paid back in instalments.
The next step in the restructuring process is another High Court hearing on 2 September to sanction the plan, followed by a US Chapter 15 procedural hearing on 3 September to gain recognition for the restructure in the US.
"We remain confident that the plan represents the best possible outcome for Virgin Atlantic and all its creditors and believe that the court will exercise its power to sanction the restructuring plan," added the airline.
By Linsey McNeill, Editor UK
Linsey McNeill
Editor Linsey McNeill has been writing about travel for more than three decades. Bylines include The Times, Telegraph, Observer, Guardian and Which? plus the South China Morning Post. She also shares insider tips on thetraveljournalist.co.uk
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