Virgin Atlantic has pledged airport slots and aircraft as collateral against a £170 million loan ($210 million) it is to receive from a hedge fund as part of the £1.2 billion financing package it has secured.

The airline says an unspecified number of aircraft and slots were used to raise the loan from Davidson Kempner Capital Management.

Virgin says that the slots that were pledged are separate from the ones it mortgaged at London Heathrow to raise a £220 million bond in 2015.

The airline owns 13 of its 43 aircraft fleet. These consist of six Boeing 787-9, four Airbus A350-1000s, two 747s and one A340, Airfinance Journal’s Fleet Tracker shows.

Virgin Atlantic has negotiated a £1.2 billion financing package from shareholders and creditors to keep it solvent amid the Covid-19 crisis.

The financing package includes £200 million provided by Virgin Group, while Delta Air Lines will defer or waive debts and charges owed by the airline worth £400 million.

Creditors will support the airline with over £450 million of deferrals and Virgin said it continued to “have the support” of credit card acquirers Lloyd’s Cardnet and First Data.

The recapitalisation will take effect over the coming 18 months and is tied to a restructuring plan which includes cost savings of circa £280 million per year and approximately £880 million of “re-phasing and financing of aircraft deliveries” over the next five years.