Virgin Atlantic Completes £1.2 Billion Financial Recapitalisation

On 4 September 2020, we completed a privately funded, solvent recapitalisation worth approximately £1.2 billion, securing essential financial support for Virgin Atlantic and Virgin Holidays during the COVID-19 crisis. The agreement followed months of negotiations with our shareholders, creditors and new investors as international travel restrictions continued to severely affect passenger demand and revenue. The restructuring plan received approval from the High Court in England and Wales and was formally recognised by a US court. It was supported by Virgin Group and Delta Air Lines, alongside investment firm Davidson Kempner Capital Management and our existing creditors and suppliers. The package included a £200 million investment from Virgin Group, £170 million in secured financing from Davidson Kempner, approximately £400 million in deferred shareholder payments and a further £450 million in creditor and supplier deferrals. The recapitalisation was accompanied by substantial changes to our business, including annual cost reductions, the retirement of older aircraft and the deferral of approximately £880 million in fleet expenditure over five years. These measures also had a serious impact on colleagues. On the day the recapitalisation was completed, we announced a further proposed reduction of 1,150 jobs, following earlier workforce reductions. Completing the agreement provided the financial framework needed to continue operating and manage the extended disruption to international travel. It reduced the immediate risk to the airline's survival, although recovery remained uncertain and depended heavily on the reopening of key markets, particularly transatlantic routes.