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UK travel company Monarch has been handed a financial lifeline after UK airline regulators agreed to extend its operating licences by an additional 12 days.

The firm now has until October 12 to convince the Civil Aviation Authority that it can meet its requirements. If it is unable to do so, it will be unable to continue selling flights and holidays, effectively putting it out of business.

Monarch was only able to secure the extension by obtaining extra funding from its shareholders.

Monarch’s airline is the UK’s eighth largest, flying primarily to European summer sun destinations. It also has tour operator and engineering divisions.

Companies selling holidays in the UK are required obtain an ATOL (Air Travel Organisers’ Licensing). Following Monarch’s financial struggles in 2014, its flights also became subject to ATOL protection.

Last week Monarch was forced to respond to “negative speculation” about its financial health.

Two years ago, the company went through similar struggles and was only saved when it was bought by Greybull Capital.

When announcing the extension, Monarch said it was “close to announcing the largest investment in its 48-year history.”

Photo Credit: A Monarch aircraft taking off. The company has been granted a 12-day extension to its operating licences. Andrew Thomas / Flickr