Richard Branson offers up private island as collateral for a Virgin Atlantic bailout

The billionaire has vowed to "raise as much money" as possible against Necker Island, the private island on which he has lived for the past 14 years.

Richard Branson, founder of Virgin Atlantic and the Virgin Group.

Richard Branson, founder of Virgin Atlantic and the Virgin Group. Source: AP

British tycoon Richard Branson has offered up his own private island as collateral in a bid to secure a bailout from the UK government for his airline Virgin Atlantic.

, the billionaire made his pledge in an open letter to his staff on Monday night, promising to "raise as much money against the island as possible to save as many jobs as possible” during the coronavirus pandemic.

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"Many airlines around the world need government support and many have already received it," Mr Branson wrote.

"This would be in the form of a commercial loan – it wouldn’t be free money and the airline would pay it back."

Mr Branson is reportedly asking for $981 million from the British government. 

He warned that, without that financial aid, his part-owned airline Virgin Atlantic would collapse.

Richard Branson's luxury home, on Necker Island in the Caribbean.
Richard Branson's luxury home, on Necker Island in the Caribbean. Source: Press Association


"We will do everything we can to keep the airline going but we will need government support to achieve that in the face of the severe uncertainty surrounding travel today and not knowing how long the planes will be grounded for," Mr Branson said in a letter to employees seen by media.

Airlines around the world are on the financial ropes as government lockdown orders and border closures have forced them to ground most of their planes.

"Without it there won't be any competition left and hundreds of thousands more jobs will be lost, along with critical connectivity and huge economic value," the letter went on.



British no-frills airline EasyJet recently secured a £600-million loan from the British government, which is dealing with airlines on a case-by-case basis rather than heeding to Virgin's demand for a multi-billion-pound state-funded pot for the entire UK airline sector.

In his letter to staff, Mr Branson referred to "lots of comments" about his wealth and a duty to prop up Virgin Atlantic and offer financial help to staff from his own pocket.

But he insisted that figures being published regarding his net worth were based on the value of Virgin businesses before the coronavirus pandemic, rather than "cash in a bank account ready to withdraw".

He added: "Today, the cash we have in the Virgin Group and my personal wealth is being invested across many companies around the world to protect as many jobs as possible, with a big part of that going to Virgin Atlantic."

Richard Branson moved to his private island 14 years ago.
Richard Branson moved to his private island 14 years ago. Source: Universal Images Group Editorial


Virgin Australia - also part-owned by Branson's Virgin Group - moved toward voluntary administration on Monday, making the carrier the largest yet to fall victim to the coronavirus pandemic.

The source said staff learned of the decision late Monday, leaving about 10,000 pilots, flight attendants and ground crew in limbo.

Administrators are now expected to be appointed to try to find a buyer for the company and manage creditors.











 

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3 min read
Published 21 April 2020 at 7:58am
Source: AFP, SBS