Virgin Atlantic Business Plan
CBJ — Creditors of Virgin Atlantic are voting on a $1.6 billion rescue plan deemed necessary if the airline is to survive due to the devastating effects of the global COVID-19 pandemic.
Richard Branson’s Virgin Group owns 51% of the airline while Delta Airlines controls the remaining 49%.
Officials with the company say they are confident a restructuring plan will be successful, leading to further discussions on a more in-depth business plan to be carried out in the United Kingdom and the United States.
Nearly 200 creditors that are owed in excess of $50,000 will be impacted by the decision moving forward. For the plan to proceed it must receive 75% support of the overall outstanding value of money owed at a hearing at London’s High Court.
Even if creditors do not support the plan to the extent required, the judge in the case can still rule that proceeding would be in their best interests if no other option seems plausible.
Virgin Atlantic was forced to close its operations at London’s Gatwick Airport and cut more than 3,500 jobs due to the ongoing pandemic.
Some industry analysts say it could take at least three years for the global airline industry to return to pre-pandemic operating levels. The concern is whether or not many of those airlines have the resources to survive on a smaller scale until that time comes about.