- Swords based Stobart part of cosortium
- Airline headed by former Cityjet CEO Christine Ourmieres
- Board recommends 1p a share bid
Christine Ourmières CEO of Flybe
Shares in the Christine Ourmieres-led English regional airline Flybe fell 90pc after a consortium led by Virgin and Swords-based Stobart offered cut-price takeover deal.Flybe’s board recommended shareholders should accept a cut-price €2.4m takeover, after the airline failed to navigate rising fuel costs, currency volatility and Brexit uncertainty.
The airline has a large presence in Belfast City airport with routes to Aberdeen, Birmingham, Cardiff, Doncaster/Sheffield, East Midlands, Edinburgh, Exeter, Glasgow, Inverness, Leeds/Bradford, London–City, Manchester, Southampton , seasonal to Newquay and seasonal charter to Salzburg. It flies five routes from Dublin to Cardiff, Doncaster, Exeter, Southend and Southampton.
The airline has a fleet of 77 operates a mixed fleet of turboprop and jet airliners, the majority being mainly Dash 8 Q400 turboprops, with four Embraer 175’s on order adding to the 11 in the fleet.
Stobart, the former Aer Arann, Virgin, part-owned by the billionaire Richard Branson, and investment house Cyrus banded together to form a joint venture, Connect Airways. The consortium offered to inject £100m into the airline through a £20m working capital loan and £80m promissory note. The 1p per share offer represented a big drop the 16.38p closing price of Flybe shares on Thursday. The shares fell by 90pc to 1.6p as trading opened on Friday.
Flybe’s board publicly put the company up for sale in November after a profit warning in October prompted plans to cut costs and reduce its flights. Stobart Group called off a bid for the airline in March. Easyjet, its rival in some of regional routes, also showed interest.
The Stobart/Virgin bid, if accepted by shareholders, would seek to feed regional customers to the long-haul networks of Virgin Atlantic and its American joint venture partner, Delta Air Lines, at Heathrow and Manchester airports. The company said it hoped to “maintain Flybe’s current Enlgihs regional focus”.
Stobart, whose shares rose by 9pc in early trading to 163.41p, said it hoped the acquisition would boost traffic at London Southend airport.
The airline launched in 1979 as Jersey European Airways following the merger of Intra Airways and Express Air Services. In 1983 the airline was sold to Walker Steel Group, which also owned Spacegrand Aviation, and the two airlines were merged under the Jersey European name in 1985. Jersey European was renamed British European in 2000 (shortened to “BE”), and received its current name in 2002.
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