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Stobart Air sale to Isle of Man firm in doubt after financing issues
The planned sale of Dublin-based Stobart Air to Isle of Man firm Ettyl has been thrown into doubt.
Stobart Air operates the Aer Lingus Regional service on a franchise basis.
Stobart Air’s UK owner, Esken, had reached agreement last month to sell the business to Isle of Man-based start-up virtual airline Ettyl.
Ettyl is headed by young entrepreneur Jason Scales, who has no track record in the aviation business.
“Esken has become aware that Ettyl's proposed financing for the transaction is no longer available and understands that Ettyl is progressing discussions with another potential financing source,” said Esken in a statement to the UK stock exchange after markets closed.
“Esken is investigating these matters and seeking further information, including with regard to the impact this may have on the ability of Ettyl to finance the transaction and obtaining the change of control consents required in order to complete the transaction,” it added. “Esken is discussing this matter with its lending banks given banking facility consent for the sale has been obtained.”
Aer Lingus has to give change of control consent to enable the transaction to proceed.
“Concluding the change of control consents is taking longer than was envisaged at the time of the announcement of the transaction,” said Esken in an earlier statement on Friday morning.
The transaction with Ettyl was also due to include the sale of Carlisle Airport to the Isle of Man firm.
Stobart Air has a contract to operate the Aer Lingus Regional service until the end of 2022.
Aer Lingus has named Conor McCarthy’s fledgling Emerald Airlines as the preferred bidder for the service after that date. The final contract with Emerald is expected to be formally signed soon.
Stobart Air has continued flying a small number of Aer Lingus Regional services during the pandemic.
Ettly planned to retain staff and senior management at Stobart Air, and to keep its Dublin headquarters.
Stobart Air, which is headed by managing director Andy Jolly, employed more than 500 people full-time before the pandemic struck.
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