easyJet has secured a £600m loan from the Bank of England’s and the UK Treasury’s new Covid Corporate Funding Facility.

Shares in the low-cost carrier climbed 13% after the announcement was made on Monday afternoon.

The company also said it would borrow another £407m from commercial creditors to ensure its liquidity.

It is the first of Britain’s major airlines to make use of the scheme to enable business borrowing.

easyJet has a fleet of 350 planes grounded for at least April and May due to the coronavirus pandemic.

Chief executive Johan Lundgren said: “Our current priority is to safeguard short term liquidity, so we have borrowed from the CCFF and drawn down on our revolving credit facility in order to increase our liquidity in the event of a prolonged grounding of the fleet.”

He added that the airline had now reached agreements with unions to furlough around 4,000 out of the 9,000 UK-based pilots and crew over the next two months.

The news of the funding came just hours after company founder Sir Stelios Haji-Ioannou warned that easyJet might still be out of cash this summer if it did not cancel a £4.5bn order from Airbus. 

Sir Stelios has threatened to remove easyJet’s finance chief if the board does not comply with his wishes.

He and his family received a near £60m share of £171m paid in dividends last month, according to public records.

 

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