Monarch package holiday licence extended amid 'significant further investment'

Monarch has been granted an extension to fly its package holidays for a further 12 days.

The low-cost airline's licence was due to expire on Friday but an extension was issued on the day in the hope Monarch might meet the requirements for a full renewal.

Monarch has since revealed it has received "significant further investment" from shareholders and thanked the Civil Aviation Authority for agreeing to temporarily extend the licence.

Earlier this week, the airline was forced to issue a statement denying it was about to go bust.

The move came amid mounting speculation surrounding the airline's financial health.

Luton-based Monarch have struggled under intense competition and a fall in demand for holidays in Turkey and Egypt.

• What happens if Monarch does go bust?

The CAA said Monarch would have been unable to sell package holidays if its Atol licence, a government-backed scheme which compensates travellers in full and ensures they are not stranded if a holiday company collapses, was not renewed.

However, it is expected that the 12-day extension will be sufficient for Monarch to to satisfy the CAA that long term funding is secure.

Andrew Swaffield, chief executive of The Monarch Group, said: "I am delighted that we have been able to come to an agreement with the CAA on the extension of Monarch's Atol licence and am excited about the additional capital coming into the group which will help us fund our future growth.

"I am immensely proud of the professionalism of the Monarch team".