Stobart grounds Flybe bid after failing to agree terms
Stobart Group has said it does not intend to make a bid for Flybe after failing to agree "satisfactory terms" with the regional airline.
Last month shares in Flybe rocketed after Stobart said it was weighing a potential approach for the Exeter-based business.
But today Stobart announced that it is "not intending to make an offer for Flybe" after the airline's board rejected the move.
It added: "Further to the announcement made by Stobart Group on 22nd February 2018, Stobart Group and Flybe have been unable to reach agreement on satisfactory terms.
"The board of Stobart Group has determined that it is not in its shareholders' best interests to increase its latest proposal for Flybe above the level which was rejected by the board of Flybe.
"Given this, Stobart Group confirms that it does not intend to make an offer for Flybe."
Stobart, whose operations span infrastructure, energy and aviation, was eyeing a tie-up as it searches out "alternative structures" for its airline and leasing business.
Flybe has been grappling with an IT overhaul and efforts to drive down costs.
Stobart Group and Flybe already work together and have a franchise arrangement between the two groups' airlines and they intend to continue a "collaborative working relationship" despite the takeover fallout.
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Flybe said in a statement: "The board of Flybe notes the announcement by Stobart Group Limited withdrawing its approach regarding a possible offer for Flybe.
"The board remains highly confident in the prospects of Flybe and believes that the group continues to have an exciting future as an independent company, delivering the Sustainable Business Improvement Plan as set out in June 2017.
"This plan is focused on driving sustainable profit and cash generation and will see the fleet size reduce to an optimum level for the number of identified profitable routes and make the business demand-driven rather than capacity-led. "