Luton, UK-based Monarch Airlines, which was established in 1968, has recently been facing financial problems which threatened continuation of its ATOL (Air Travel Operator’s License) agreement. That license grants passengers financial protection so that if an airline goes into liquidation while they are abroad they are not left stranded.
The airline has now announced that it has secured its ATOL status after it “successfully concluded discussions with the Civil Aviation Authority.”
Currently the airline, which specializes in package holidays, has been seeking funding from a number of external sources to avoid the full financial burden falling on its major shareholder, Greybull Capital. That company is owned by the two Meyohas brothers and holds a 90% share in the airline, with the Pension Protection Fund owning the remaining 10%. It has also been announced that The Monarch Group has “received significant further investment from shareholders and is close to announcing the largest investment in its 48-year history.”
Those involved in the talks with the CAA included Marc Meyohas, Andrew Swaffield who is Monarch’s chief executive, representatives of the CAA, and Freshfields, who are the solicitors acting on behalf of Monarch.
Andrew Swaffield, Chief Executive Officer of The Monarch Group, commented: “I am delighted that we have been able to come to an agreement with the CAA on the extension of Monarch’s ATOL license and am excited about the additional capital coming into the group which will help us fund our future growth. I am immensely proud of the professionalism of the Monarch team.”
The airline had previously fought off insolvency two years ago when Greybull bought the airline from the Swiss Mantegazza family. Greybull specializes in acquiring distressed businesses, while to keep Monarch operational, the airline’s 2,800 staff took pay cuts of up to 30%, though also accepting hundreds of redundancies.
The airline has said that it is trading well, but puts the current crisis down to three factors: the recent spate of terrorist attacks, the Brexit vote, and the fall in value of the pound sterling. It is believed that interest has been shown in the possible acquisition of Monarch Airlines by the HNA Group, which owns Hainan Airlines.
(Editor’s note – the article previously published on AviTrader concerning Monarch Airlines contained information which was outdated and we are happy to provide more positive and up-to-date information regarding events.)
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