Virgin Atlantic’s $1.6b rescue approved by UK court

Virgin Atlantic Airways secured backing from a UK court for a GBP1.2b rescue package Wednesday that will keep billionaire Richard Branson’s airline afloat amid the coronavirus pandemic’s ravaging of the travel industry. The ruling by Judge Richard Snowden clears the path for a bailout that will see US hedge fund Davidson Kempner Capital Management provide funds to the carrier alongside Branson, its founder. Snowden said he was “satisfied” with the plan. None of the creditors opposed the approval at the hearing. Virgin Atlantic saw demand cut to a quarter of 2019 levels in the first half of the year and was denied aid by the UK government after the virus grounded flights. The carrier cut more than 3,000 staff and the remaining 6,500 jobs were at risk as CEO Shai Weiss warned that the airline will run out of cash within weeks without a rescue. An American procedural court hearing is scheduled to take place as part of the firm’s Chapter 15 bankruptcy protection that’s aligned with the British proceedings. “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,” the company said.<br/>