Monarch Airlines is reported to be in talks with aviation authorities to gain breathing space as it seeks to organise a multimillion-pound cash injection before its licence to fly expires at midnight.
The carrier may seek a temporary extension to its annual operating licence from the Civil Aviation Authority if it can show it is close to arranging funding, The Guardian reported.
Monarch and many other travel businesses must renew their Atols by midnight on Friday.
The carrier has been in talks with the regulator after doubts arose on Sunday about its financial strength.
This triggered the airline to respond on Monday by saying that it expected to announce a “significant investment” from its stakeholders in the coming days “to weather tougher market conditions and to fund its ongoing growth”.
Monarch is 90% owned by private investment firm Greybull Capital that rescued it two years ago. On that occasion, the CAA gave Monarch a three-week extension so that it could complete the deal with Greybull.
The wording of the statement, which said the airline was trading well and expected to achieve a profit of over £40 million by the end of its financial year, suggests Greybull will not provide all the money and will seek support, possibly from Monarch’s banks or other potential investors.
Chinese conglomerate HNA Group, which owns Hainan Airlines, is understood to have shown interest in Monarch, which has blamed industry difficulties on terrorist attacks, the Brexit vote and the fall in the pound.
An update will be provided “as soon as the airline is in the position to give one,” a spokesman told the Manchester Evening News.
Spokesmen for Monarch and the CAA declined to comment on the licence renewal. The Monarch spokesman said all flights were operating as normal.
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