Banks won't lend large piles of cash to VS, but they will lend to SRB personally. If SRB borrows the cash in his own name. he is personally liable for the debt and the banks have the legal right to come after him through the courts to ensure the loan is repaid
Both SRB and Delta know that Virgin Atlantic has very little chance of being able to generate enough profits over the next 10 years to be able to repay the money that VS needs to survive
Delta have just had a huge bailout from the US Govt - it woud look *really* bad in the USA if they were seen to be spending some of this US tax money on supporting a British airline
If you owned a business that generates £1m profit per year, but right now needs an investment of £50m (and in future years will still only have profits of max £2m per year if the economy is doing well), would you invest £50m of your personal cash ? Or would you walk away and put the company into voluntary liquidation (knowing that this will absolve you of any penalty around reckless trading as a company director) ?
SRB might find it emotionally sad to walk away from VS but he knows that financially it's the right thing for him to do
Last edited by davidjohnson6; 20th Apr 2020 at 17:05.