Virgin Atlantic filed for US bankruptcy protection yesterday under the Chapter 15 arrangement. The move is simply to protect accounts and assets the company owns in the United States from creditors.
The company revealed the move in a UK court filing, where it received permission to take its re-financing and restructure package worth £1.2 billion (US$1.57 billion), to creditors on August 24th. The package if accepted will allow the airline to continue and go through recovery.
However, while its unlikely, if creditors decided otherwise, the airline said it will run out of money by the middle of September.
Virgin Atlantic said that bookings were down 89% compared to 2019 and demand for the rest of 2020 was at just 25%..
Virgin Atlantic was keen to emphasise it hasn’t taken any government money and now wouldn’t have to.