Richard Branson's Virgin Atlantic airline is seeking bankruptcy protection as it tries to survive the COVID-19 pandemic's effects on air travel.
Virgin Atlantic, the airline founded by British businessman Richard Branson, filed Tuesday for protection in U.S. Bankruptcy Court as it tries to survive the virus pandemic that is hammering the airline industry.
A spokeswoman for Virgin Atlantic said the bankruptcy filing is part of a court process in the United Kingdom to carry out a restructuring plan that the airline announced last month. The process is supported by a majority of the airline’s creditors, and the company hopes to emerge from the process in September, she said.
Branson appealed to the British government for financial help this year — even saying that he would pledge his Caribbean island resort as collateral for a loan — but was rebuffed. Atlanta-based Delta Air Lines, which owns 49% of the airline, agreed to defer payments it was owed, and hedge fund Davidson Kempner agreed to lend Virgin Atlantic about $220 million. Virgin Atlantic also delayed deliveries of Airbus jets.Virgin Atlantic’s court moves follow bankruptcy filings in the U.S. by Latin America’s two biggest airlines, Latam and Avianca, as well as by Mexico’s Aeromexico, since the start of the pandemic.
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