An alternative bid to the ongoing Virgin Atlantic and Stobart Air deal cannot be achieved in the necessary timeframe, says Flybe.
The loss-making regional carrier Flybe has rejected an alternative rescue plan that suddenly appeared yesterday, saying it would stick with its earlier bid from a consortium of Virgin Atlantic, Stobart Air and a US hedge fund.
After the airline put itself up for sale in November, having already warned of coming heavy losses, the Connect Airways consortium put forward a bid in mid-January of a rather modest £2.2 million (€2.5 million).
The board at Flybe accepted the offer – despite anger from shareholders as well as pilots whose pay deals include Flybe shares. Since then, Connect has injected £15 million into the struggling carrier.
Anger intensified when Stobart Air’s former chief executive Andrew Tinkler, who was sacked acrimoniously in 2017, snapped up a large amount of the shares immediately after the Connect deal was revealed.
The new bid
Then, on Tuesday, “a preliminary and highly conditional outline contingency proposal from an investor group led by Bateleur Capital LLC and Mesa Air Group Inc, with indicative support from Mr Andrew Tinkler and other unnamed institutional shareholders”, as Flybe put it, arrived in the carrier’s inbox.
The bid is on condition that the sale to Connect Airways, which is to be finalised on February 22, does not take place.
However, “the Board does not believe that the Indicative Proposal is executable in the timeframe required to enable Flybe to continue to trade,” Flybe responded today.
“Accordingly, the Board emphasises to shareholders that it continues to regard the arrangements entered into with Connect Airways as being the only viable option available to the Company which provides the security that the business needs to continue to trade successfully.