£1.2bn bailout agreed for Virgin Atlantic

VIRGIN Atlantic’s

£1.2 billion bailout has been signed off by a High Court judge.

Last week, the airline’s creditors voted to approve the deal, which the airline said was a “significant milestone in safeguarding its future”.

At a remote court hearing yesterday, Mr Justice Snowden sanctioned the restructuring plan – a key step of the process for Virgin Atlantic to implement the rescue package.

The senior judge said: “This is a plan that I propose to sanction.”

The £1.2 billion rescue deal, announced in July, involves only private funds, and includes a cash injection of £200 million from founder Sir Richard Branson’s Virgin Group.

David Allison QC, for Virgin Atlantic, told the court that four creditor meetings were held last week, with 100 per cent attendance and 100% approval at three of them.

The fourth saw the deal approved by the vast majority of those present and voting.

In written submissions, Mr Allison said it was “in the best interests of all stakeholders” to reach an agreement that enables the airline “to survive and thrive as a going concern”.

He said the firm is proposing the deal as part of a wider suite of financial arrangements with creditors and others, which will reduce the airline’s debt to “a sustainable level” and “provide new liquidity”.

The airline has previously insisted that without a “solvent recapitalisation” its directors would have “no choice” but to place it into administration.

In a statement after the hearing, a Virgin Atlantic spokesperson said: “Achieving this significant milestone puts Virgin Atlantic in a position to rebuild its balance sheet, restore customer confidence and welcome passengers back to the skies, safely, as soon as they are ready to travel.”