British billionaire asks government for help to save his airline.
The group led by billionaire entrepreneur Richard Branson has requested a £500 million package of commercial loans and state guarantees to help cover its fixed costs.
Billionaire entrepreneur Richard Branson has stated that he will need a loan from the British government for his airline, Virgin Atlantic, to survive the crisis caused by the coronavirus.
The statement was made in a open letter to its employees published this Monday (20). According to the document, although Virgin is doing everything possible to overcome the current crisis, the company will need “government support to achieve this goal given the serious uncertainty surrounding the travel sector”. The group requested a package of £500 million in commercial loans and state guarantees to help pay its fixed costs.
Branson's letter comes after the British airline easyJet, a competitor of Virgin, secured a £600 million loan from the British government earlier this month. "The reality of this unprecedented crisis is that many airlines around the world need government support and many have already received it. Without it, there will be no more competition and hundreds of thousands of jobs will be lost," the businessman's letter states.
In the document, Branson also offers to put up his luxury holiday resort in the British Virgin Islands, which he acquired at age 29, as collateral to secure the loan from the government.
The Virgin Empire
Among the companies in Richard Branson's conglomerate, Virgin Australia—the Australian airline—is in the worst condition. Operating at a loss for more than seven years and burdened with a debt of US$3,2 billion, the company has been unable to secure a loan from the Australian government.
Last month, Virgin announced it would allocate $250 million to support its business and protect jobs. The group has more than 70.000 employees in 35 countries.
Branson, who has a net worth of $4,4 billion according to Forbes magazine, said his wealth was calculated based on the value of Virgin's business before the crisis and "that he doesn't have the money in a bank account ready to be withdrawn."