Virgin Atlantic’s £1.2 billion restructuring plan has been cleared by the high court.
A final US court hearing will now be held on Thursday (3 September).
Further approval in the US will set the bid up for completion, ending months of uncertainty over the airline’s future.
"Achieving this significant milestone puts Virgin Atlantic in a position to rebuild its balance sheet, restore customer confidence, and welcome passengers back to the skies," said a Virgin spokesperson.
After its initial efforts to tap government for support earlier this year were knocked back, Virgin Atlantic announced a major restructuring and refinancing package on 14 July.
The restructure is based on a five-year business plan, with the airline currently engaged in a legal process to secure the support of Virgin Group, which holds a 51% stake in Virgin Atlantic, and Delta, which holds the remaining 49%, as well as existing creditors and new private investors.
Should Virgin’s plans for a "solvent recapitalisation" progress, the deal would deliver a refinancing package worth around £1.2 billion over the next 18 months.
It comes in addition to cost savings of £280 million a year, while a further £880 million will be saved over the next five years through rephasing and financing aircraft deliveries.
Shareholders will provide an additional £600 million in support over the life of the business plan, which includes £200 million investment from Virgin Group and £400 million shareholder deferrals and waivers.
Davidson Kempner Capital Management LP will provide £170 million secured financing. Creditors have also supported the airline with more than £450 million in deferrals.
Virgin’s credit card acquirers and merchant service providers Lloyd’s Cardnet, First Data and American Express have also all given the process their backing.