Virgin Atlantic Said to Be in Talks for $540 Million Fundraising
(Bloomberg) -- Virgin Atlantic Airways Ltd. is in discussions with its shareholders about a 400 million-pound ($540 million) capital injection, according to a person familiar with the matter.
Added funding would bolster Virgin Atlantic’s balance sheet as it looks to cash-in on pent-up demand for air travel as restrictions lift, said the person, who requested not being identified because the information isn’t public.. It would also provide a buffer should new outbreaks of Covid-19 prompt further lockdowns. Sky News first reported the potential capital increase earlier on Saturday.
A spokesperson said the company doesn’t comment on speculation. Virgin Atlantic, controlled by founder Richard Branson, was weighing a London listing earlier in the year, but the company has since slowed plans for an initial public offering, opting to rebuild its business before making the case to investors in 2022, Bloomberg News has reported.
The carrier averted collapse last year with the support of a 1.2 billion-pound rescue package from owners and lenders after the U.K. government refused it access to state funds. Virgin Group owns a 51% stake with the rest held by Delta Air Lines Inc.
Airlines have cautiously begun to add flights between the U.S. and Europe, but Asia isn’t likely to open up to outsiders until early next year. The long-distance flights that Virgin Atlantic specializes in have lagged shorter routes in recovering from the travel slump triggered by the coronavirus pandemic early last year.
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