Like many companies right now, Richard Branson's Virgin Atlantic and Virgin Australia airlines are seeking financial support from the government (in this case, the UK and Australia) to weather the coronavirus pandemic. Unlike many business owners, Branson has a pretty impressive possession that CNN reports he offers as collateral: his own private island of Necker in the Caribbean.
Branson exposed the situation in an open letter to Virgin Atlantic and Virgin Australia employees, citing "the severe uncertainty surrounding today's travel" as a potentially fatal blow to companies. Branson had previously injected $ 250 million into his various companies under the Virgin banner to keep them afloat, but is now seeking government loans, and is putting his island to "raise as much money as possible against the island." save as many jobs as possible across the group. "
The letter continues:
"The reality of this unprecedented crisis is that many airlines around the world need government support and many have already received it. Without it there will be no competition left and hundreds of thousands more jobs will be lost, along with critical connectivity and enormous economic value. "
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Airlines in Europe and Australia are in a somewhat different financial situation than their US counterparts, as a massive industry bailout was included in the recent coronavirus economic stimulus package in the United States. Therefore, airlines have to approach these governments on a case-by-case basis. Branson has been criticized for seeking financial support from the government in the UK due to the fact that he does not pay income tax there, establishing full-time residence on Necker Island, the criticism he addressed in the letter, saying that Virgin companies pay taxes in the UK, even if they don't.
It is still unclear how much money Branson will seek for his companies with his private island on the line, but a recent Financial Times report stated that the UK government told Virgin to resubmit its original request for a loan from about $ 622.2 million in US dollars, which could explain why Branson is making this move with his own island.