Virgin Atlantic’s £1.2 billion restructuring plan was sanctioned by the English High Court on Wednesday (September 3).
A spokesperson for the airline said: “In order to complete the private-only, solvent recapitalisation of the airline, our restructuring plan has gone through a court-sanctioned process under Part 26A of the UK Companies Act 2006, to secure approval from certain creditors before implementation.
“Today, Virgin Atlantic attended an English High Court hearing where the restructuring plan was formally sanctioned.
“A US procedural hearing will follow tomorrow (September 3), ensuring the restructuring plan is recognised in the US, paving the way for completion of the £1.2 billion private only, solvent recapitalisation of Virgin Atlantic.
“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 restructuring plan was announced on July 14 and on August 25, the airline secured the overwhelming support of creditors.
The recapitalisation will deliver a refinancing package worth £1.2 billion over the next 18 months in addition to the self-help measures already taken, including cost savings of £280 million per year and a £880 million rephasing and financing of aircraft deliveries over the next five years.
Shareholders are providing £600 million in support over five years, including a £200 million investment from Virgin Group, and £400 million of shareholder deferrals and waivers.
US hedge fund Davidson Kempner Capital Management LP is providing £170 million of secured financing.
Creditors have also supported the airline with more than £450 million of deferrals.