Sky News reported yesterday that Alvarez & Marsal had been put on standby to assemble contingency plans for any potential insolvency process at the airline.
In the Sunday Times today Shai Weiss said he was “100% confident” Virgin Atlantic could survive, adding it was “too good not to”.
Weiss also said talks with the Treasury for a loan were “constructive” and that it had “set the bar very high, and we respect that a great deal”.
Asked by the paper whether Virgin Atlantic would ever be able to repay any loan from the government, Weiss was adamant that the cost cuts would allow it to repay the state in full within five years, at a rate of up to £100 million a year.
“I can assure you that Virgin Atlantic can become sustainably profitable in order to repay the debt,” he said. “These facilities may not actually be drawn down, they’re there to ensure that the airline can operate.
“But I would say that within two to five years, we would pay it back, and probably even sooner. This is not a hand-out. We will repay it with interest.”
Weiss further added he found the recent job cut announcement “heart-breaking...especially when our secret sauce is our people”.
He added: “But we are doing this so we can save as many jobs for when we resume normal flying.”
A Virgin Atlantic spokesperson said: “Because of significant costs to our business caused by unprecedented market conditions which the Covid-19 crisis has brought with it, we are exploring all available options to obtain additional external funding.
“[Financial services company] Houlihan Lokey has been appointed to assist the process, focusing on private sector funding.
“Meanwhile, we continue to take decisive action to reduce our costs, preserve cash and protect as many jobs as possible. Discussions with a number of stakeholders continue and are constructive, meanwhile the airline remains in a stable position.
“Virgin Atlantic is committed to continuing to provide essential connectivity on competitive terms to consumers and businesses in Britain and beyond, once we emerge from this crisis.”
