Monarch airline gets cash injection to allow it to continue flying

Monarch has secured a £165m cash injection from its owner, Greybull Capital, allowing it to retain its licence to operate.

By The Newsroom
Wednesday, 12th October 2016, 8:38 am
Updated Tuesday, 25th October 2016, 7:14 pm

The airline had faced a midnight deadline to secure fresh funding or risk being unable to renew its Atol licence.

The group said that, alongside the investment - the biggest in its 48-year history - Monarch would take delivery of the first of 30 Boeing 737 MAX-8 aircraft in 2018.

Chief executive Andrew Swaffield said: “It is testament to the extensive effort by all parties, over the past weeks and months, that we are able to announce the largest investment in our 48-year history, as well as the renewal of our Atol licences.

“I’d like to thank the Civil Aviation Authority, our shareholders, partners, loyal customers and the team at Monarch for helping us to achieve this successful outcome. We are now firmly focused on the future as a stronger Monarch.”

The company’s future had been cast into doubt over the past weeks, with Monarch forced to deny “negative speculation” that it was in financial trouble.

A further extension of the Atol licence by the CAA was dependent on fresh funding. The scheme compensates travellers in full and ensures they are not stranded if a holiday company collapses.

Monarch will now be able to sell package holidays.

Greybull acquired a controlling stake in Monarch in 2014, but the group has struggled financially.

The firm booked a £19.2m pre-tax profit in the 12 months to the end of October 2015 following a £57.3m loss a year earlier, according to accounts filed at Companies House.

A CAA spokesman said: “The CAA has renewed Monarch’s Atol licences until the end of September 2017 following confirmation that all licence requirements have been met.

“Monarch’s licences permit them to sell Atol-protected holidays until 30 September 2017, after which they will be required to obtain a new licence in line with the annual process for all Atol-protected companies.”

Mr Swaffield will speak at the annual convention of travel organisation Abta in Abu Dhabi, organisers said.

He cancelled a scheduled appearance at the event on Tuesday, which a Monarch spokesman said was due to him having “business to attend to in the UK”.