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Virgin Atlantic lenders tap Deloitte for advice on rescue deal

Matthew Field
Virgin Atlantic

Virgin Atlantic’s lenders have tapped Deloitte to advise them over their exposure to the carrier as it faces a race to secure rescue funding.

The banks have at least £250m owed to them, Sky News reported, as Sir Richard Branson’s airline conducts emergency talks with the Government and private investors in search of a £500m lifeline.

Virgin Atlantic has been hit heavily by the coronavirus pandemic. It has cut more than 3,000 staff and shelved operations from Gatwick. It has warned it will not relaunch flights until August under government quarantine plans and placed advisers on standby for a possible administration.

Last week, Sir Richard sold $350m (£288m) worth of shares in his space venture, Virgin Galactic, and is expected to use the funds as part of an investment in the airline.

The Sunday Telegraph previously revealed that New York hedge fund Elliott Management, the fund founded by formidable investor Paul Singer, was among the names considering a potential injection of capital into Virgin Atlantic, Other hedge funds including Davidson Kempner Capital Management, Greybull and Centerbridge are also in the mix.

On Sunday, The Telegraph reported UK trade groups including Airlines UK had written to No10 in a bid to secure a reprieve from planned quarantine measures that are due to come into force in June.

The signatories warned that without the possibility of “air bridges”, the two week requirement for people to isolate at home when arriving in the UK would devastated businesses and tourism.

A Virgin Atlantic spokesman said: “Discussions with a number of stakeholders continue and are constructive, meanwhile the airline remains in a stable position.”