14:30 GMT31 October 2020
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    In April, Branson who owns 51% of Virgin Atlantic offered to mortgage his private Caribbean island, where he has lived tax-free for the last 14 years, as collateral to secure a UK government loan to help his business empire.

    Sir Richard Branson is to sell $500 million (£405 million) in Virgin Galactic shares to help save his other businesses including Virgin Atlantic, the Guardian reports. 

    Virgin Galactic, the American space tourism venture which is 55 percent owned by the billionaire intends to sell 25 million shares via a series of transactions.

    The shares, sold via Sir Richard’s British Virgin Islands-based shell company Vieco 10, account for around a fifth of the billionaire’s stake in the space tourism business.

    As reported in the BBC, Virgin Group said it will use the proceeds to support its “leisure, holiday and travel businesses” hit by “the unprecedented impact of Covid-19.”

    The airline and tourism industry has been badly affected by the coronavirus pandemic as governments around the world imposed travel restrictions to help slow down the spread of the virus.

    Last week Virgin Atlantic announced plans to cut more than 3,000 jobs and end its operation at Gatwick Airport.

    G-VCRU Boeing 787-900 Dreamliner Virgin Atlantic visiting Prestwick for some crew training
    G-VCRU Boeing 787-900 Dreamliner Virgin Atlantic visiting Prestwick for some crew training

    Virgin Atlantic’s flights from Gatwick – grounded due to the collapse in demand caused by the coronavirus pandemic – will not restart. Some routes will be switched to Heathrow.

    Rival airline British Airways announced earlier this month it was planning to cut 12,000 jobs, and it also emerged it is considering closing its Gatwick base.

    Meanwhile, 15% of the retail estate used by Virgin Holidays will close this year, and the travel firm will be renamed Virgin Atlantic Holidays.

    Last month Virgin Australia collapsed into administration and left Virgin Atlantic in severe financial difficulty.

    Virgin Atlantic has been seeking emergency investment but is also hoping to gain a state bailout to help the struggling company while travel restrictions are in place.

    Branson has been criticized for seeking financial help from the taxpayer due to his vast personal wealth.

    As well as selling shares in Virgin Galactic, Branson has said he will put his luxury Necker Island resort up for collateral to secure a UK government loan believed to be around £500 million. 

    As reported in the BBC, in March Chancellor Rishi Sunak wrote to airlines and airports urging them to find private funding and the government would only step in as a “last resort” during the coronavirus crisis. 

    Tags:
    business, pandemic, United Kingdom, Richard Branson, Virgin Atlantic, Virgin Galactic
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