Jet2 raises $581.6 million to withstand travel slump

LONDON: British holiday company Jet2 has raised 422 million pounds ($581.6 million) through a new share issue to help it ride out the COVID-19 pandemic.

With almost a year of travel restrictions having taken a heavy toll, airlines and travel companies were plunged deeper into crisis on Tuesday when Britain tightened its rules.

Holidays are already banned under lockdown, but now travellers into the UK must have three COVID-19 tests - one before departure and two in the days after arrival.

Desperate for travel to have restarted by this summer, the industry has said the government must urgently set out how it will lift restrictions.

Jet2 said its latest fundrasing gives it sufficient liquidity to contend with what it expects to be an extended and unpredictable shutdown, adding that it is maintaining a cautious approach to the 2021 summer season.

Bigger competitor TUI , the world’s largest holiday group, was more optimistic outlook on Tuesday.

The company, which has been bailed out by the German government, plans to operate 80% of its 2019 capacity. Its chief executive said he was confident about the peak travel season, adding that its current financial resources would be “enough until summer”.

But tightening restrictions, including the introduction of quarantine hotels, plus repeated warnings from British government ministers not to book holidays, means uncertainty persists.