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| Virgin Atlantic wins backing for £1.2bn rescue deal | Virgin Atlantic wins backing for £1.2bn rescue deal |
| (32 minutes later) | |
| Virgin Atlantic has won backing from its creditors for a £1.2bn rescue plan that will secure its future for at least the next 18 months. | Virgin Atlantic has won backing from its creditors for a £1.2bn rescue plan that will secure its future for at least the next 18 months. |
| The airline said shareholders, banks, aircraft owners and suppliers owed money had approved the plan. | |
| Virgin Atlantic said "this milestone" puts it in a position to "rebuild its balance sheet" and "welcome passengers back". | Virgin Atlantic said "this milestone" puts it in a position to "rebuild its balance sheet" and "welcome passengers back". |
| It had warned it would run out of cash by September without the deal. | It had warned it would run out of cash by September without the deal. |
| The company will now need approval from the High Court in London, which it will seek on 2 September. | The company will now need approval from the High Court in London, which it will seek on 2 September. |
| The £1.2bn rescue deal involves £400m in new cash, half of which will come from its main shareholder, Sir Richard Branson's Virgin Group. | The £1.2bn rescue deal involves £400m in new cash, half of which will come from its main shareholder, Sir Richard Branson's Virgin Group. |
| Like other airlines, Virgin Atlantic's finances have been hit hard by the collapse in air travel due to the pandemic. | Like other airlines, Virgin Atlantic's finances have been hit hard by the collapse in air travel due to the pandemic. |
| It is cutting 3,500 staff, but the airline has said the remaining 6,500 jobs should be secure. | It is cutting 3,500 staff, but the airline has said the remaining 6,500 jobs should be secure. |
| The International Air Transport Association warned in June that the slump will drive airline losses of more than $84bn (£64bn) globally this year. | |
| Virgin Australia deal | |
| Robert Boyle, a former director of strategy at British Airways-owner IAG who now runs his own aviation consultancy, told the BBC that under the deal, Virgin Atlantic's unsecured creditors would end up being paid 20% less than they were owed. | |
| Their repayments will also be rescheduled. | |
| Mr Boyle said the extra cash secured under the rescue deal did not "seem like enough", given that Sir Richard had asked the government for £500m and had his request rejected. | |
| In April, Virgin Australia went into voluntary administration, making it Australia's first big corporate casualty of the coronavirus pandemic. | |
| The following month it was bought by Bain Capital, which said it supported the airline's current management team and its turnaround plan for the business. | |
| Last month Virgin Atlantic faced enforcement action over its delays in processing refunds for cancelled flights. | |
| It was the only airline threatened with action by the Civil Aviation Authority (CAA), which has reviewed the refund waiting times of 18 major airlines. | |
| Virgin has been making consumers wait up to 120 days for a refund and the CAA said it was "not satisfied". |