Flybe has been plucked from a potential collapse after the UK Government and company shareholders, including Virgin Atlantic, agreed to provide tens of millions of pounds emergency funding.
The airline will continue to operate its domestic and regional routes for now, which are relied upon by around 8 million people each year.
It is unclear exactly how much additional funding Flybe’s owner, Connect Airways, will give to the loss-making airline.
The UK’s business secretary, Andrea Leadsom, confirmed the deal, tweeting: “Delighted that we have reached agreement with Flybe's shareholders to keep the company operating, ensuring that UK regions remain connected.”
Chairman for Connect Airways, Lucien Farrell, said: “We are very encouraged with recent developments, especially the government's recognition of the importance of Flybe to communities and businesses across the UK and the desire to strengthen regional connectivity.”
Mark Anderson, chief executive of Flybe, said: “This is a positive outcome for the UK and will allow us to focus on delivering for our customers and planning for the future.
“Flybe is made up of an incredible team of people, serving millions of loyal customers who rely on the vital regional connectivity that we provide.”
Just two days ago, Flybe’s future seemed highly uncertain as the company faced collapse, having run out of money. Accountancy firm EY was reportedly on standby to deal with an administration of the airline.
Flybe, branded Europe’s largest regional airline, has around 2,400 staff and flies to 170 destinations.