I think this may be related to this bug:

https://bugs.launchpad.net/ubuntu/+source/initramfs-tools/+bug/129910

As splashy relies on vga=xxx being enabled, so if it isn't working (my
ttys are broken as well), then it's likely not doing splashy any favours
either.

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Splashy causes reboot loop in initramfs
https://bugs.launchpad.net/bugs/206894
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