The Monarch Group has received a £75 million cash injection and has announced a major restructuring.
Backed by the wealthy Swiss Mantegazza family, this is the second time in two years that the Mantegazzas have stepped in to refinance the group.
Monarch said the deal has been agreed with the group’s shareholders “based on a business plan developed in response to the high fuel price environment in the airline”.
The refinancing will allow Monarch Airlines to develop its scheduled business and expand its fleet from 30 to 40 aircraft “over the medium term”.
For Summer 2012 the airline will add two additional Airbus A320 aircraft to its fleet and will launch 14 new routes from its existing bases at London Gatwick, London Luton, Manchester and Birmingham, taking the total number of scheduled routes served by the airline to 73.
The airline will be expanding its scheduled operations into Italy and Croatia.
It aims to ultimately increase passenger numbers from 7 million to 10 million.
Announcing the restructure, the group, which includes Monarch Airlines and Cosmos, confirmed a £45 million loss in the year to October.
It blamed the loss on “turbulent market conditions and high oil prices” and forecast modest growth for 2012.
It is putting a cost reduction programme into place “based on efficiencies and simplification of fleet operations in the airline”, including the retirement of a number of older aircraft.
“I firmly believe that from the combination of stable background and the correct strategy we will exploit and strengthen our niche market position and take advantage of the opportunities which will undoubtedly arise as our sector adapts to the current challenging market conditions,” said executive chairman Iain Rawlinson.
