NEW YORK ( The Deal) -- U.K. airline Monarch Holdings on Wednesday said its workforce had agreed to a cut in salaries of up to 30% as it negotiates a sale to London investor Greybull Capital.
The airline, based in Luton, England, said 96% of its pilots had approved of the reductions and 88.4% of the mechanics were willing to accept the cuts. Unions behind the employees also backed the plans. The company is also reportedly working to slash as many as 1,000 jobs.
"Further hurdles are still to be overcome, however we have also secured major agreements with aircraft lessors and commitments on future investment from Greybull," CEO Andrew Swaffield said in a statement.
Monarch, which is majority owned by Mantegazza family, of Switzerland, on Tuesday said it had picked Greybull as the preferred bidder in a sale. The Mantegazza family are heirs to the Lugano, Switzerland-based Globus Tours fortune and is willing to inject £70 million ($114.2 million) in the airline to be rid of it, according to The Sunday Times.
The company in August launched a strategic review amid reports its pension fund was in need of an £158 million injection. In July it reorganized its top executives, appointing Andrew Swaffield, former managing director of travel rewards company Avios Group Ltd., CEO and Andrew Lavery CFO.
Lavery is a former head of investments and joint ventures at British Airways plc. The new executives cut the proportion of charter flights operated by the airline to 15%.
In the year ended October , Monarch's revenue rose 16% to £1.2 billion with passenger numbers growing 9%. The figures are the latest available and didn't include profit, though the company said all units were profitable before one-time items.
A Monarch representative couldn't be reached for comment.
Greybull is the London-based investment vehicle of brothers Nathaniel and Marc Meyohas as well as Richard Perlhagen. It describes itself as "a family office with a focus on investing in private companies across a diversified range of industry sectors." The firm was one of the financial backers behind the disastrous acquisition of U.K. electronics retailer Comet Group Ltd. from Kesa Electricals plc. in 2011.
Comet went bankrupt - leaving its workforce of 7,000 unemployed - about a year after the investor group, which was led by OpCapital LLP, agreed to take over the company in exchange for a £50 million injection by its previous owners.
Greybull in April backed out of talks to buy some U.K. assets of El Dorado, Ark.-based Murphy Oil Corp. for $500 million.