Monarch Airlines has clinched its biggest ever investment from owners Greybull Capital in a bid to secure the survival of the no-frills airline.

The £165m lifeline has convinced the regulator to renew its Air Travel Operators’ Licence (Atol) until next September after granting a last-minute extension to Monarch’s existing licence just four hours before it was due to expire at the end of last month.

Central to Monarch’s rescue bid is a restructuring of a $3.2bn (£2.6bn) deal with Boeing for up to 45 aircraft, which is expected to release significant cash back into the business and delay an increase in costs for two years.

Monarch boss Andrew Swaffield confirmed that the rejigged deal would include a “sale-and-leaseback agreement” that could see Boeing buy Monarch's order on the condition that the airline agrees to lease the aircraft from 2018 when the first planes are set to be delivered.

The company said that the Boeing agreement had “facilitated” the £165m cash injection from Greybull, which holds a 90pc stake in the company after agreeing to pump £125m of capital into Monarch in 2014.

Greybull’s latest bailout is the fourth for the airline in the space of five years.