AIRLINE: Monarch's licence to operate extended

Budget airline Monarch has received a extension to its licence to sell holidays with flights, the company has announced.

It also said it had secured additional funds and was close to announcing its biggest ever investment.

The news came just ahead of a midnight deadline for the renewal of its Civil Aviation Authority (CAA) licence .

Last weekend Monarch was forced to deny "negative speculation" about its financial health. 

On Saturday Monarch is due to operate 133 outbound and inbound flights, and passengers have been expressing their concerns about what was going to happen on social media.

There are more than 100,000 Monarch holiday-makers overseas at the moment.

The airline employs around 2,800 staff and is based at Luton Airport.

Temporary extension

Monarch is protected by the CAA's Air Travel Organisers' Licensing (Atol) scheme - the scheme that refunds customers if a travel firm collapses, and ensures they are not stranded.

But for the licence to be renewed, allowing it to continue to sell holidays with flights, the company had to prove that it was financially robust. 

The company has been majority-owned by Greybull Capital since 2014, when the investment firm bought a 90% stake in the airline.

Greybull has now put put extra funds into the airline and that has given the CAA confidence to grant a temporary extension to the airline's licence until 12 October.

By that time Monarch is confident it will have secured the "largest investment in its 48-year history".

In a statement the CAA said it was able to extend the licence "by requiring the shareholder to provide additional funding and because customers' money will be protected".

"Monarch now has 12 days to satisfy the CAA that the group is able to meet the requirements for a full Atol licence. 

"Monarch will remain Atol-licensed until this extension expires. The CAA always advises consumers to ensure they book Atol-protected air holidays and consumers who choose to book an Atol-protected flight or holiday with the company during this time will continue to be protected by the Atol scheme."

Monarch's website says Atol offers consumer security "where a flight and accommodation have been booked together, some flights booked separately and applies in certain other circumstances".

Earlier this year Greybull bought a division of Tata Steel, as well as 140 M Local convenience stores from Morrisons, which subsequently went into administration.