The two companies have been in negotiations for four months, exploring a range of partnership options from marketing and code sharing through to Virgin taking a 51 per cent stake.
Virgin is keen to establish a presence in the Caribbean and believes its involvement with BWIA would help restore that flagging airline's fortunes.
It is one of the region's biggest internal carriers, boasts a daily service from Heathrow and has international routes to Frankfurt, Zurich, New York, Miami and South America.
However, BWIA has run into turbulence recently. It lost more than pounds 1m in the first quarter of the year and its chief executive and chief operating officer both resigned in February.
BWIA has also struggled to compete in the US and British markets, where it is up against American Airlines and British Airways.
The Trinidad and Tobago government sold a majority interest in BWIA to three private shareholders last year. The government retains 33.5 per cent and employees 15.5 per cent.Reuse content