British Airways bolsters cash reserves by £2.4 billionBusiness | 22 Feb 2021 11:10 pm
The owner of British Airways has announced a new round of funding for its flagship airline amid continuing coronavirus crisis disruption to global travel, Sky News reports.
International Airlines Group (IAG) said a loan and deal on deferred pension contributions had boosted BA's liquidity by £2.45 billion as the industry burns through cash due to coronavirus disease restrictions.
Under the pension scheme agreement, worth £450 million, the airline will pay no dividends to IAG before the end of 2023 in return for delaying deficit contributions due between October 2020 and September 2021.
Dividend restrictions are also a condition of the £2 billion five-year loan, which is partially guaranteed by the government's UK Export Finance unit.
"In addition to these arrangements, IAG continues to explore other debt initiatives to improve further its liquidity," IAG said.
The company, which also owns Iberia and Vueling in Spain and Ireland's Aer Lingus, scrapped its dividend to shareholders last April and raised £2.4 billion from investors to help it survive.-Photo: Sky News