Tuesday 20 November 2018

Flybe shares take wing as Stobart Group eyes takeover bid

Shares in the regional airline were up 24% in afternoon trading on the London Stock Exchange.

Regional airline Flybe faces a potential takeover swoop from Stobart Group (Tim Goode/PA)
Regional airline Flybe faces a potential takeover swoop from Stobart Group (Tim Goode/PA)

By Ben Woods, Press Association Chief City Correspondent

Shares in Flybe have soared by more than a fifth after the owner of London Southend Airport said it was weighing a potential swoop for the regional airline.

Flybe was up 24% in afternoon trading on the London Stock Exchange, with Stobart Group eyeing a tie-up as it searches out “alternative structures” for its airline and leasing business.

Stobart Group, which spans infrastructure, energy and aviation, said one option was to take a “non-controlling interest in a vehicle to acquire 100% of Flybe”.

A number of potential structures have been considered including taking a non-controlling interest in a vehicle to acquire 100% of Flybe likely to be in cash Stobart Group statement

However, it cautioned that there was no guarantee a firm offer will be made.

In a statement, Stobart said: “Stobart Group and Flybe have a range of shared interests arising from Stobart Group’s ownership of London Southend Airport and its aircraft leasing company and the growing franchise arrangements between the two groups’ airlines.

“As previously disclosed in October 2017, we have been reviewing alternative structures for our airline and leasing business that can play an important part in the consolidation of the regional airline sector.

“A number of potential structures have been considered including taking a non-controlling interest in a vehicle to acquire 100% of Flybe likely to be in cash.”

Flybe has been grappling with an IT overhaul and efforts to drive down costs, with half-year profits nearly halving at £8.4 million when it updated the market in November.

However, revenues climbed 8.5% to £158.8 million during the third quarter as passenger numbers rose 8.1% to 2.3 million.

Shares in Stobart Group rose more than 2% following the announcement.

Press Association

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