Originally Posted by
Toofewmiles
As far as the balance sheet, one thing to also keep in mind is that Virgin Group can't own equity past 25% - but that does not mean that if a liquidity crunch arises (which it doesn't look like they're in danger of at this point) that a debt investment can't be made. Whether or not it's in VG's best interest as a separate entity to make such a debt contribution on terms that don't provide appropriate returns is a legit question, but there are some advantages in being private and tightly controlled so that shareholders can't howl if you do such a thing.
25% is the limit on non-citizen ownership of voting control in a US airline - while non-citizens are permitted to own just under 50% of the total equity in a US airline. What's the difference? Could be some non-voting stock.
And yes, if additional cash is required, I don't think the limits apply to debt financing, provided that the debt doesn't look like equity (market terms, market interest rates, etc).